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Car Insurance Bullies

If you have an accident in your car, it’s reasonable to expect your insurer to pay out for damages. And if the car is a write-off (meaning it would cost more to repair than the car is worth – if repairable at all), then your insurer is expected to pay you the current retail value of your car in its pre-accident state.

The Association of British Insurers state that the insurer must pay you a sum which would allow you to purchase a similar car in a similar condition, in your local area. The only deduction which should be applied is the pre-agreed excess.

But this isn’t always the case. It’s rare for an insurer and a driver to agree on what a car is worth; often the insurer will offer several hundred pounds below the current retail value, and use a variety of tricks to get you to accept this lower – and often unfair – amount.

Sometimes the payout will be based on a trade price; usually lower than a ‘Joe Public’ driver would expect to pay. This contravenes ABI guidelines as, unless you’re a car dealer, you couldn’t expect to get a similar car for such a low price. Sometimes they’ll base a payout on a general valuation, not taking into account your local area and the season. For example; a Land rover will be more valuable in a rural area, yet the insurer may base their amount on a city price, or pay for the price of a soft-top in winter when you’d actually need to buy one in summer.

Many people have been duped into thinking that, when the settlement cheque arrives, they have to cash it. This is further misled by the letter stating that by cashing the cheque you are accepting this payment and cannot contest it. Obviously, drivers are thinking that they have to accept this (lower) payment and have no choice in the matter. This is not true. Send the cheque back – by recorded post – with a letter stating you don’t accept this payment as you believe it to be below the value of your car. If you have to cash the cheque as you need the money, write to the insurers stating that you are accepting it as an interim payment, and you intend to pursue them for the full amount.

The condition of your car can be a sticking point. Insurers have been known to insist a car was more damaged pre-accident that it actually was, to avoid paying out a fair amount. General signs of wear and tear are not acceptable reasons for lowering a payout, yet some insurers use engineers who will mark down a car’s value because of minor scratches or dents.

One final trick used by unscrupulous insurers is to offer an independent assessor to look over your car, and provide an unbiased valuation. This comes with a non-refundable fee, and insurers rely on the fact that most drivers will be so fed up by this point that they’ll accept the valuation to avoid paying the assessor. Also, if you decide to enlist the assessor and they find the valuation to be below your own expectations, you will only be entitled to the original offer, not any increased ones that the insurer may have offered since. So only use an assessor if you are 100% sure your valuation exceeds any offers. If you are having difficulties, consult the Financial Ombudsman who can investigate your claim for you.

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