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Car insurance payout deduction

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Hi there,

I wondered if anyone can help me with a query I have regarding a claim I had.


While I was asleep in bed one night, my car was hit by a drunk driver. Simple enough, got a pay out no problem.


The issue I have is they valued my T reg Peugeot 306 at £1500, that's fine as well, but they only paid my £1200? Now before I bought the car a year and half earlier it had been written off (cat c) and had be fixed up and sold to me. I knew the history and didn't mind, car still had to pass an MOT and get checked to confirm it had been restored to original state so no danger.


My insurance company said they deducted 20% from the market value of £1500 because of this previous crash. Now they knew the cars history and there is nothing in my policy about the fact they can do this deduction. I have asked them to provide me with evidence of the terms and conditions stating this and they have replied saying they don't have any, they just review each valuation and the market trends to establish a deduction.

Now how can they just take £300 off me without any prior notification or policy wording?


I'm not sure that's legal? Doesn't sound right to me. They can just amend any car market value to suit their needs if that's the case?


Anyone offer and advise or opinion?


Thanks :)

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A sound case of where staff get crappy training and cannot explain the most simple of things.


They can do it. All they are doing (supposed to be doing) basically is looking at the vehicle and determining how much it is worth, though they do have to justify the valuation.


The reason why it's not in the policy is simply because it is not a term of he contract. The contract will state that they will provide the value of the vehicle in cash in such circumstances, but it will not state how such a valuation will be reached - that cannot be contracted for in practical terms.

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But hadn't they determined how much it was worth with the market value? As far as I've heard when a vehicle is repaired after an accident it has to be put back to the condition it was before hand, monetary and safety wise so in fact it's indemnified from the crash as it's should be as if it never happened. So the £1500 is right and what they should have paid out.

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They will look at the market value and then say "but it has had repairs and is therefore worth less than the market value".


Like I said, they have to justify it, though. It's a while since I last worked in insurance, so I may be a bit out of date. Maybe someone else can come along and advise.

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Who is actually making the payout? Wasn't it the drunk driver who caused the accident (or their insurers) who is paying, or weren't they ever identified? If you had to claim off your own comprehensive policy, did you have to pay an excess? If that's the case, then you wouldn't get the full market value anyway, as the excess would be deducted from that.

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The drunk driver couldn't go far, he wrote off his car as well!! So police took him away.

It's his insurance paying for it....which makes me even more annoyed really as it's not as if my insurance company lose anything, it's not their money.

The excess was taken off and has been paid back to me, it's the £300 for it being in a crash before that is the issue I'm asking about.

I don't understand how they can just take it when the previous crash has nothing to do with this one. The car has been restored and MOT'd and been running as normal for a year and a half and the market value was £1500. How can they choose to take more money off without informing a customer? That sounds such a con?!?

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Actually that's an interesting and quite technical point. If I have understood correctly your argument is this.



You have a vehicle worth £1500.

The vehicle is involved in an accident.

You claim on the insurance, and the insurer is due to put you back into the same position as you were before the accident.



The vehicle is involved in another accident.

The current insurer value it at £1200 because of the previous repairs undertaken.



So either:

(a) The current insurer is undervaluing the car, or

(b) The previous insurer did not return you to the condition prior to the first accident.




This is a tricky one as it leaves you £300 down wondering who to claim it from. I would ask for the loss adjuster's report of the condition of the vehicle, and ask them to explain explicitly what parts of that report made them decide to reduce their assessment of the value of the vehicle.



Either they can't provide justification of their valuation or they have to provide evidence you can use against your first insurer.



Anyone know of a precedent for this?

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I'm now waiting on their reply as I'm just shocked they can take money without me knowing this could happen. Maybe I'm naive but I wasn't aware of it at all :(


And plus they seem to be taking money twice, they agree the Glasses guide puts the car at £1750.00 (£1800.00 actually with the lower mileage....) then they reduce it to £1500.00 because of the cars condition (I also don't agree with this as the car was in a condition that matched the Glasses spec) ....then reduce it again because of the cars previous crash??


Anyway, we shall see what happens. Thanks for your input guys :)

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Ultimately you and the insurer need to reach an agreement on what the vehicle is worth. You are right to be shocked, because they can't do this without your permission.


They make you an offer (for whatever reason) and you can accept or decline the offer. If you decline it is my opinion that you should clearly state why, provide your estimation of the value and give evidence as to why you think it is worth this (glass' guide, evidence of condition, similar models on ebay/autotrader/local dealer etc).


Ultimately if you can't agree it will end up in court for them to decide it. However claims departments are under pressure to try it on (especially if they are a third party claims handler as they need to perform well or lose their contract), so they will always try stuff on. Don't stand for it!

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  • 1 month later...

Hi all, just thought I would update on this thread in case anyone else ever has same problem.


I waited and waited and even sent another reminder letter through to the insurance company saying please respond or I will have to go to the ombudsman. That was back in July and I FINALLY posted off all the paperwork to the ombudsman today.


Then when I got home......there was a cheque on my doormat waiting for me for £300 :D So I won!!! :D Got a decent value for my car and I'm happy :)


Can you believe it, the day I post the stuff off to complain the cheque turns up lol :D


Lets hope I don't have to do this again....as my new car is an ex crash victim fixed up as well.....

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