CIS - What Do I Do ?

[Wizard1]

Hi

On the 26/01/08 my car (Citroen Ax) was legally parked outside the house when it was hit by another (Insured) driver. The driver was hurt & taken to hospital. The police obtained his details (Name,address & Reg No) & passed them onto me the following day. All the details were given to my (Fully Comp) Insurance company CIS, who then contacted Albany Asssitance to arrange for a hire car. CIS sent an inspector to look at my Citroen, he said it was a complete write-off. He asked me for the purchase price, (£450, 6 months prior to the accident) also for any recent bills. Over the last 4 months I have spent £142 on 2x tyres & a new exhaust. He said that I would get all of that back.

On the 12/02/08 I recieved an offer from my own Insurance company (CIS) for £450 minus £250 excess. I wrote back the same day declining their offer. on the 27/02/08 I reiceved a letter from Albany Assistance, saying that because I had not replied to the Offer made by CIS, they were requesting the Hire car back. I telephoned Albany & explained that I had replied & had declined their offer. Details were taken & they suggested that I contacted CIS myself. I contacted CIS & eventually was given a phone number for their Total Loss dept in Stoke. I telephoned & was told by a very arrogant lad, that he had my letter in front of him. He went on to say that this was the best offer & only offer they could make. I explained about the recent bills (CIS where sent copies along with the Log Book & Current MOT Cert) he said that I could not claim for these as they were for general wear & tear & maintanance of the vehicle. He advised me to accept their offer, I declined. I have since emailed Albany attaching a copy of the letter sent to CIS declining the offer.

My Insurance with CIS was taken out in August 07. The premium was £1544.50 as it a second car with my (18 year old) son as a named driver. When asked for the value of the Citroen, I valued it as £800 because of the exceptional condition & service history.

I cannot understand why CIS are being so stubborn, at the end of the day it will be the third party's insurance that pay. If they made me an offer around £600, To cover the cost of the vehicle + additional funds spent that would be acceptable. I would appreciate any advice on what to do next.

Regards

Wizard

[gyzmo]

Quite a few issues here - I'll try to break them down.

Firstly, any costs that they incur can be reclaimed back from a guilty third party, but those costs must be reasonable. these losses generally must be covered on your policy in order for it to be recovered from the third party.

As to the costs. What a vehicle is worth to you and what it's financial value is are two entirely separate things. You could easily pay over the odds for an item, or cherish something that is of little monetary value. If there is nothing particularly special about the car, then it will be it's usual financial value that is used (which is (or was a few years ago) normally done by using Glasses guide as well as examples of vehicles of similar age, condition etc advertised in the local press (or car mags). Paying for items, such as wheels, exhaust etc are run of the mill things taht would be expected, and will not add value to the car (unless there was somethig particularly unusual such as gold plating or a top spec design, but even then it may not matter much).

The value that you place on a car is not realy used to assess its value - it is more to do with identifying anything unusual (so if you said your 1990 fiat panda was worth £8000, that would indicate that there is something about the car they need to know about). Your valuation therefore would not really matter that much.

As to the hire car. This is a benefit provided to you to compensate you (loss of usage of vehicle). Once the insurer has made an offer, the car becomes returnable. Otherwise, you would have (in theory) the payment due under the policy PLUS the hire car - this means that you are being overcompensated. An insurance policy is in theory there to put you back in the same financial position that you enjoyed before the incident (this is termed "indemnity", though this does not happen in practice (E.g, if your £800 car is written off, you will get £800 less the excess - not £800).
The problem arises where you dispute the sum. As far as the insurance company is concerned, until proven otherwise, you have been indemnified by their offer. At that point, the car company will want its car back.
Now the fact that you dispute the figure does not, unfortunately, matter at this point - it is rather subjective. The offer may, in fact, be perfectly reasonable - it has yet to be demonstrated.

Now as I said before, the insurer (and hire car co) want their money back (from the third party) - or at least know they will get it back. Until the dispute is sorted, the actual figure recoverable is the offer made to you. The third party will not accept anything beyond that - they will say, for example, "well a loss of £500 has been paid out, we will pay that £500 for that is the loss suffered". If they see the £500 PLUS continuing car hire, they will no pay for the hire car - as far as they are concerned, you are being over-indemnified.

It's a horrible combination of differing interests and independant factors. If you do wish to dispute the value, obtain examples of cars in similar condition, age etc of a higher amount than that offered. Be aware though that just because someone is selling a car at £800 does not mean it is worth £800!

As to your excess, normally the third party will pay this to you. If not, then check if you have legal expense cover to reclaim this. If you do not, you may have cover elsewhere, but insurers usually pay (or at least used to) without legal action having to be resorted to.

Whoever assess you car was completely wrong to say that you will get it all back - there are so many circumstances that could result in not getting even half of it back.

Put everything in writing to the insurer and keep a log of all communications, expenses etc.

[Wizard1]

Hi gyzmo

Thanks for the info. A friend of mine has told me to get in touch with an Independent Loss Assesor or the FOS to resolve this claim. Would you recommend this as the next course of action ?

Personally I think I need to wait & see what the CIS put in writing first.

Regards

Wizard1

[gyzmo]

I would agree with you. I take it you have put in an official complaint - in which case the insurer will have a timeframe to stick to when providing a response. If the fail to meet that deadline (8 weeks), or if the response is unsatisfactory, then go to the FOS - you will need all documents, details of phone calls etc to help them investigate.

[Wizard1]

Hi gyzmo

I have trawled through lots of adverts on ebay & autotrader to try to find a similar replacement vehicle. The prices range from £600 (Much Higher Mileage & 2 Years Older) to £1,200 (6 Months Newer, Same Mileage). This morning I spoke to a local motor trader, he said to replace mine in similar condition he would expect me to pay £800+.

I don't know this trader, but he has kindly offered to put this in writing for me. He went on to say that although I only paid £450 for my car, that was irrelevant it is the replacement cost that matters.

Regards

Wizard1

[gyzmo]

dont forget though that there is an element of profit involved with sales. Imagine a £2,000 car on a forecourt. It may have a years "free" insurance, some kind of quality check (say an AA inspection) at £150, plus a couple of other "freebies". Then there is the sellers profit to consider. Deduct all of them and you will be left with substantially less than £2,000. However, it is worth showing such examples to the insurance company and leave it to them to justify their value.