Insurance letter to broker opened in error...
Discussion
A letter was opened in error by our office which was from a large Insurance co. (sorry)
Being nosey I read the letters, it appears that a particular car was in an accident and the cost of the repair was more than the value of the car. Fair enough.
Said insurance co then offered a figure to their client of £x , which they in their internal documentation confirmed as being only 80% of the value of the car?? The insured does not know they only paid out 80% rather than 100%.
Do all insurance co do this as it appears they are not paying out all they should to their policy holder/client. There was no mention of blame or other reducing factor.
Just interested, any views? (letter has now been forwarded.)
Being nosey I read the letters, it appears that a particular car was in an accident and the cost of the repair was more than the value of the car. Fair enough.
Said insurance co then offered a figure to their client of £x , which they in their internal documentation confirmed as being only 80% of the value of the car?? The insured does not know they only paid out 80% rather than 100%.
Do all insurance co do this as it appears they are not paying out all they should to their policy holder/client. There was no mention of blame or other reducing factor.
Just interested, any views? (letter has now been forwarded.)
If I have read this post correctly - this is normal. They give you the "real" market value of the car at the time of payout - minus a small amount. There is no way that they can payout full for a car that you bought a few years ago.... just doesnt make sense. However, something that a lot of people forget is that you are supposed to NEGOTIATE at this point. You are in your rights and you can supply supporting documentation to prove its value - hence the car club valuations for example. You can choose to turn down their offer and go for a higher value...
Or alternatively buy the car from them as part of the settlement... but remember that the car will be marked as a total loss though.
Cheers,
Paul
Or alternatively buy the car from them as part of the settlement... but remember that the car will be marked as a total loss though.
Cheers,
Paul
It is a con, of course. My policy sites 'market value'. On questioning the MD he confessed it was 'trade value' - which of course is about 20% less than retail value. He further confessed that this meant I would not be able to replace my car like-for-like if it was written off. The policy also asks me to state the value of the car, and if I vary this the premium changes. However, it does not appear to be linked to final payout. All very mysterious. 2+2=3.
When the insurance co. offered me half the value of my totalled X1/9 years ago, I challenged them.
Other owners were helpful, as were specialists, eventually I negotiated them up to 3/4 of the value and the wreck.
I then used the wreck against a new cylinder head for the Integrale I'd bought since at a Italian car specialists so in effect, I'd got the full value back.
It pays to haggle with insurance companies.
Other owners were helpful, as were specialists, eventually I negotiated them up to 3/4 of the value and the wreck.
I then used the wreck against a new cylinder head for the Integrale I'd bought since at a Italian car specialists so in effect, I'd got the full value back.
It pays to haggle with insurance companies.
Simpo One is correct. Most insurers will pay out a value equivalent to the most pessimistic estimate you could come up with in your mind for what your car might be worth if you used it in part exchange with a dealer who didn't really want it (ie. peanuts, and way below what you know your car is worth).
You then have to add quite a bit of money to get to the figure you'd actually need in order to walk into said dealer and buy a replacement car.
That's Motor Insurance for you, unfortunately.
You then have to add quite a bit of money to get to the figure you'd actually need in order to walk into said dealer and buy a replacement car.
That's Motor Insurance for you, unfortunately.
think it depends on the company and the car.
there is obviously a balance between trying to pay the minimum out versus the added costs to them of getting into negotiations, and the fact that the customer gets hacked off.
my own experience is that the first offer I got, I accepted, as it was far in excess of what I thought the car was worth.
there is obviously a balance between trying to pay the minimum out versus the added costs to them of getting into negotiations, and the fact that the customer gets hacked off.
my own experience is that the first offer I got, I accepted, as it was far in excess of what I thought the car was worth.
Dont forget that you can get GAP insurance with your car loan these days. I have it with my A&L loan on the TVR - i.e. it makes the difference between what the insurance company pays for and the REAL market value. Only costs around £30 on the total of the loan. For a little piece of mind, well worth it...
Cheers,
Paul
Cheers,
Paul
I am an insurance broker and cant say we've ever received a letter like that. The broker is acting for the client and not the insurance company and as such it would be unlikely that the insurer could expect the broker not to pass this info on to the client. We find what insurers offer varies from case to case with no real rhymn or reason .. some are adequate or even generous ( ones you dont hear about ) and others are really taking the p1ss, if in doubrt do argue though.. copies of adverts for similar cars will often do teh trick.
Don't forget, we all shop around for the cheapest insurance every year. How many of check the pay out reputations of who we go with and are willing to pay extra for it?
Believe it or not even insurance companies need to make a buck. Premium = claim frequency * claim amount + profit. If they can drop claim amounts, can charge lower premium, get more business, make more profit. We drive it really.
Well actually most insurers aren't that sophisticated and just see what everyone else is charging and whether they made any money last year. Principle still hold though.
Maf
Believe it or not even insurance companies need to make a buck. Premium = claim frequency * claim amount + profit. If they can drop claim amounts, can charge lower premium, get more business, make more profit. We drive it really.
Well actually most insurers aren't that sophisticated and just see what everyone else is charging and whether they made any money last year. Principle still hold though.
Maf
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