Insurance Claim Problems

RumbleBee

RumbleBee

RumbleBee

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Joined
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Location
Teesside, UK
My wife, having being hit by a another car has gone through the usual process of making a claim. Her car has now been written off and the 28 day courtesy car has been returned. 3rd party has accepted blame, due to my wife being hit from behind whilst she was stationary.

Insurance company have advised they will release the cheque once she has accepted the offer and posted her driving license (and mine too, being an additional driver)

Now the messed up part.
It seems that my wife did not declare an SP30 when she took the policy out 11 months ago. During those 11 months she received another SP30, so she now has 2 x SP30's. Now I know these are not convictions and they are endorsements, but I read her policy documents and it's printed clear as day these should have been noted. To make matters I'm an additional driver on the policy and my SP30 from 2005 is also not noted. My insurance is with the same company and my SP30 is recorded.

Aside from nagging her, which I have done already does anybody have an idea what can happen here? I've told her to phone them immediately and let them know. She keeps saying that they never asked when she took the policy and that the guy was in a rush on the phone so it was never made clear. This of course is irrelevant as you'll surely agree.

The claim is in the region of £4600.
 
I would be torn between telling them and hoping they still pay, and keeping quiet and hoping they don't notice.

It was very silly though, as you already seem to be aware.
 
The silliest thing here is involving your own insurance company in any capacity beyond simply notifying them of the accident.

Had you not done this not only would you have a courtesy car for more than 28 days, but your driving license details would be of no concern to the third party insurer.
 
[TW]Fox;10814001 said:
The silliest thing here is involving your own insurance company in any capacity beyond simply notifying them of the accident.

Had you not done this not only would you have a courtesy car for more than 28 days, but your driving license details would be of no concern to the third party insurer.
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It's her own insurance company that are requesting the driving license.

Just to add the car was on finance and it has been arranged for the cheque to pay the remaining finance, which is short by £300 that she/we will need to pay
 
The duty of disclosure is on the policyholder so it is entirely irrelevant if the insurer did not ask for details. The insurer is now entitled to void the policy Ab Initio i.e. from inception and consequently you will not receive payment for your claim but you will receive the premium back in full (on the basis that legally the policy has not existed).

However, many insurers now take the view that it is preferable to rectify the policy by requesting the additional premium that they would have charged had they been aware of the first conviction. This does usually depend upon the amount of the additional premium.

Although strictly speaking the second conviction is immediately discloseable, most insurers will accept disclosure at renewal so you may be okay with this. As far as your own conviction goes, technically the insurer already knew about it.

Once you inform your insurer of the misrepresentation (failure to disclose), and they intend to void the policy, then they will have to comply with the ABI code of practice. They MUST issue a letter in writing reserving their rights to void the policy and on what grounds (they cannot simply say 'we reserve our rights' which I have seen many times), and they also MUST advise you to seek legal representation. Furthermore, they cannot make any amendments or cancel the insurance policy whist their rights are reserved. If they do, they have confirmed the existence of the contract.

Finally, even if they do void you can still seek recompense from the responsibly party. Your rights of recovery are unaffected.

Which insurer is it? I may be able to give you an indication of the likely outcome (albeit not guaranteed).

Sorry if this reads like jargon. PM me if you want any more info.

Best of luck.
 
Gillywibble said:
The duty of disclosure is on the policyholder so it is entirely irrelevant if the insurer did not ask for details. The insurer is now entitled to void the policy Ab Initio i.e. from inception and consequently you will not receive payment for your claim but you will receive the premium back in full (on the basis that legally the policy has not existed).
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Can you clarify two things:

a) I was under the impression they can only void ab initio if they can show that had they known about the information, they would have refused to insure

b) The payout is, actually, coming from the third parties insurer as a result of a non fault accident. As a result of this, the driving license status is surely irrelevant as even somebody who is uninsured can claim from a third parties insurer following a non fault accident.
 
Gillywibble said:
Which insurer is it? I may be able to give you an indication of the likely outcome (albeit not guaranteed).
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Churchill Insurance

Although the 3rd party involved has accepted liability the monies still comes from her own insurerer (Churchill). They are the ones that have advised regarding releasing a cheque after receiving our licenses and she has never spoken to the other persons insurance company.
 
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[TW]Fox;10814138 said:
Can you clarify two things:

a) I was under the impression they can only void ab initio if they can show that had they known about the information, they would have refused to insure
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No, they can void if it would have resulted in an additional premium.

[TW]Fox;10814138 said:
b) The payout is, actually, coming from the third parties insurer as a result of a non fault accident. As a result of this, the driving license status is surely irrelevant as even somebody who is uninsured can claim from a third parties insurer following a non fault accident.
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Ultimately it is yes, but there is still misrepresentation to her own insurer.

Thinking aloud, the OP could cancel their claim against their own insurer, pursue the third party direct and at renewal, change insurers and disclose the convictions. Not a bad idea at the 11th hour.
 
RumbleBee said:
Churchill Insurance

Although the 3rd party involved has accepted liability the monies still comes from her own insurerer (Churchill). They are the ones that have advised regarding releasing a cheque after receiving our licenses.
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For future reference, if you find yourself in this situation again do not deal with it through your own insurer. Either go direct to the third party insurer, or use an accident management company. Not only will it avoid issues like this (Mind you so will disclosing endorsements) but you'll be treated far better and you'll get a better courtesy vehicle.
 
Gillywibble said:
No, they can void if it would have resulted in an additional premium.
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According to whom? My understanding was that, at least in the eyes of the ABI, the fair and just resolution to such a situation would be to minus the additional premium they would have charged from any payout. Voiding an entire policy for a mistake on the part of the policyholder which in all likelyhood would have increased the policy by no more than £50 would not be considered fair.

It would also cost them a fortune - it's cheaper to just accept it than it is to refund the entire policy. Especially if the insurer is able to recover the entire cost of the claim from the third party insurer anyway?

Thinking aloud, the OP could cancel their claim against their own insurer, pursue the third party direct and at renewal, change insurers and disclose the convictions. Not a bad idea at the 11th hour.
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I agree :) This will also mean her NCB will not be suspended whilst her own insurer recovers their losses which can often take a while.
 
I don't understand, why does it matter if her insurance would now be void as surely the third parties insurer is covering all the costs??

Her insurer could cancel the policy tomorrow on the grounds of you not telling them about the SP30s, but that won't make a blind bit of difference to the third party company dealing with it?

As Fox says, if hit by a 3rd party and it's their fault never get your insurance company involved, ring them to say something's happened but that it is all being dealt with and for them to not lift a finger/spend a thing :)
 
The problem is that technically, if your policy is voided you then have to disclose this to a subsequent insurer and if you don't, you're back at square one and if you do, not many will insure you (for a bargain at any rate).

[TW]Fox, yes they can void irrespective of the additional premium but as I said in my original post, insurers rarely do unless the premium is a large amount. I have voided a policy for less than £50, not so long ago either (the claim was fraudulent though).
 
They are a business at the end of the day and from a business point of view, assuming the policy cost say £500, it makes no sense to cancel and refund £500 when they could instead simply charge an additional £50 on top of the £500.

Option 1 would leave them down £500 and Option 2 would leave them up £50.

Of course it would be utterly different if she had driven into a wall and was claiming for her own damage as then potentially option 1 would cost £500 but save them £xxxx on repairing the damage. But this isnt the case here and thus my personal opinion, which is of course not that of a lawyer and comes with no warranty at all and is entirely at risk, is that they wont void :p
 
Thanks for all the replies. I'm thinking cancelling her claim might be the best option and claiming direct against the 3rd party insurer. I wonder how Churchill will feel about this though. Will they accept this and case closed?

She paid additional premiums for the option of a courtesy car so it's not like they have done her any favours through all of this.
 
[TW]Fox;10814301 said:
Cancellation could be difficult if Churchill have provided a courtesy car at their cost to you.
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This is just to cancel the claim. Not to cancel the policy. When she took the policy she did pay extra for a courtesy car.

Paying the additional premiums required for the SP30 (or 2x SP30) might be the best option if this is the case, providing of course this would allow things to be cleared up.
 
RumbleBee said:
This is just to cancel the claim. Not to cancel the policy. When she took the policy she did pay extra for a courtesy car.
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What I'm saying is that presumably Churchill have paid for a courtesy car for you which they are expecting to recover the cost of through the third party.
 
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