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My car was recently stolen and found in a burnt out condition.
I notified Direct Line and they started the claim process and valued my car at £1800 (massively undervalued but there is a dispute over that still pending)
anyhow, the reason for my post is that during the course of their "interview" I mentioned that when I bought the car the wheels fitted were not standard but had been fitted by the previous owner.
DL are now claiming retrospective premiums for last year and this year and also wish to increase my excess because of this "new information" this will mean over £500 being taken from my payout
The point of my post is this;
are they allowed to apply retrospective premiums? aren't they just another way of saying penalty charges?
What's the chances of getting the full payout instead of their reduced option?
Would it be worth resolving the claim first and then seeking the retrospective premiums through the small claims process
Just looking for anyone who may have experience of such a circumstance
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Please note: i am not a qualified lawyer, any advice is offered in good faith and is based on my own and others experiences and a penchant for research and a desire to help others to empower themselves
Basically an insurer offers to insure a car based on certain facts (type of car, experience/age of driver, accident and claims history of driver and a myriad of other factors as well).
One of the things they will have asked you was 'Is the car standard as per manufacturers list or have there been any modifications', they ask this because some mods make the car more desirable to steal, or more likely to have an accident, this in turn changes the risk you bring to them, so the premium increases accordingly.
They are basically claiming that you underpaid a premium because the car was not 'standard' and those wheels would have affected the premium, if when you took out the policy you didn't inform them of this (and by your own admission you were aware the wheels had been changed) then they are correct. It's not a penalty charge as such, it's more a case of you paying the correct premium they would have asked for if you had mentioned this when you took the policy out.
Having said that, £500 is a bit steep just for wheels, which are a cosmetic enhancement, they don't affect performance. I accept they might be more desirable to a thief and so the risk of theft associated with your type of car has gone up but £500 is in my opinion excessive.
I'd write to them and ask how they arrive at this figure.
Basically an insurer offers to insure a car based on certain facts (type of car, experience/age of driver, accident and claims history of driver and a myriad of other factors as well).
One of the things they will have asked you was 'Is the car standard as per manufacturers list or have there been any modifications', they ask this because some mods make the car more desirable to steal, or more likely to have an accident, this in turn changes the risk you bring to them, so the premium increases accordingly.
They are basically claiming that you underpaid a premium because the car was not 'standard' and those wheels would have affected the premium, if when you took out the policy you didn't inform them of this (and by your own admission you were aware the wheels had been changed) then they are correct. It's not a penalty charge as such, it's more a case of you paying the correct premium they would have asked for if you had mentioned this when you took the policy out.
Having said that, £500 is a bit steep just for wheels, which are a cosmetic enhancement, they don't affect performance. I accept they might be more desirable to a thief and so the risk of theft associated with your type of car has gone up but £500 is in my opinion excessive.
I'd write to them and ask how they arrive at this figure.
Mossy
The figure of £500 on its own is perhaps a little misleading ansd should be clarified a little more. It is made up of their proposed backdated increase of premiums for last year and this year and also for a revision of my current excess. say £113 for each year in backdated premiums and an extra £100 on my excess, so instead of having my payout reduced by an excess of less than £200, it is now to be reduced by over £500
I sought clarification with them for the reasons regarding the increase as the wheels were still on the burnt out shell when they recovered the car and as such couldn't have been the reason for the theft. but they simply stick to the line "you didn't declare the modification" They are basically using this as a chance to minimise their outlay, Whilst I was aware of the change of wheels, they were not replaced with super duper bespoke whee4ls, just another BMW alloy wheel (from another similar model)
To be fair if my quotation for insurance had been £113 higher, or my excess £100 higher at the time of looking for the insurance, then I wouldn't have insured my car with DL in the first place and would have found someone cheaper as per the thousands of ads on telly at the mo'
Hope this helps
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If you feel that have been helpful please feel free to tip the scales.
The large print giveth, but the small print taketh away. ~Tom Waits, Small Change
Please note: i am not a qualified lawyer, any advice is offered in good faith and is based on my own and others experiences and a penchant for research and a desire to help others to empower themselves
OK now what you need to do is go to an authorised BMW dealer and find out the following.......
1) The cost of replacing the alloy wheels that originally came with your car
2) The cost of replacing the alloy wheels that were actually fitted to your car.
3) Ask the dealership if in their opinion the wheels you had fitted were a magnet for thieves and do they get asked to replace these on a regular basis because of theft.
If there is virtually no difference in price then you have a justifiable argument with DL because you can show that the cosmetic modification presented no bigger risk to them in financial terms, if they suggest that the replacement alloys were 'more desirable to thieves' and presented a bigger risk ask them for proof of this and then point out that in this instance they were not stolen and as such did not contribute in any way to this claim.
A cosmetic mod is something that certain insurers do use to try and get more money out of the policyholders when in reality it doesn't affect the risk presented, I'm not suggesting DL are one of those insurers, but I do think this is a bit steep, what they need to remember is that wheels do sometimes get changed because of theft or damage and it isn't always possible to get the exact same wheels that came with the car.
I'm thinking you may have a valid argument which the fos maybe able to help with
I am also not sure that they can claim the increased premium for last year, as well as this year. The contract of insurance for last year is over and closed.
we had a similar situation, it did throw up some questions etc
1. Are we allowed to charge for the previous year as this is a yearly contract and that the previous years contract has now expired?
2. We have charged extra for the alloy wheels but WILL NOT increase the offer for the total loss as the wheels add no value to the vehicle (then why charge).
Insurers can charge for previous years if they can show that you were 'under-insured' or failed to disclose something that increased the risk.
vusys1
The Insurer will probably state that whilst the alloy wheels didn't increase the market value of the car (which may or may not be true), they did increase the risk of theft (since they were more desirable to thieves) and increased the premium to reflect this, hence the increase in charge but no increase in value. I know that might sound unusual but in some cases it is true, but I don't think it is in every case.
I personally think they are using whatever they can to minimise the eventual payout.
I have no option but to wait until the "engineer" calls back and we correct his undervaluation and then accept the claim for what it is.
DL will lose another client
Hope this helps
If you feel that this site has helped you in any way please leave a donation if you can afford to do so.
If you feel that have been helpful please feel free to tip the scales.
The large print giveth, but the small print taketh away. ~Tom Waits, Small Change
Please note: i am not a qualified lawyer, any advice is offered in good faith and is based on my own and others experiences and a penchant for research and a desire to help others to empower themselves
I personally think they are using whatever they can to minimise the eventual payout.
Of course they are!
You never get the full figure of what something is worth from them
I QUESTION THEREFORE I AM!!
Unfortunately i'm not an expert in any given field legally and my advice and that of the Consumer Action Group and the Bank Action Group is given without prejudice and without liability so please if in any doubt whatsoever seek help from an insured qualified professional. Contents of my posts are purely my own personal opinions and not condoned or endorsed in any way, shape or form by CAG. Thank you!
Direct Line taking the mickey
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Originally Posted by Mossycat
