UK Motor Insurance – FAQs

This is a collection of the most Frequently Asked Questions on the subject of car insurance and all that it involves.

Car Insurance FAQs (A-E) 

Conditional Fee:

Q : What is No Win No Fee?

A : No Win No fee refers to agreements called Conditional Fee Agreements (CFA’s) whereby you pay an insurance premium that fully protects you against all the legal costs involved in pursuing a personal injury claim. It is governed by the Conditional Fee Agreements Regulations 2000. This came into force on 1st April 2000, Essentially any insurance premium paid and any success fee which has been agreed to be paid can be recovered from the other party in the event of a successful claim.

Crossing the Road:

Q : Can a pedestrian ever be held liable for crossing the road?

A : There has been a recent case where this happened. The claimants were pedestrians struck by the defendant’s vehicle on a pedestrian crossing at a junction controlled by traffic lights. The claimants were obscured by a stationary lorry at the pedestrian crossing. The trial judge held that the defendant was not liable since he was under no obligation to stop at a green light, and if he was wrong on primary liability he assessed the claimants’ contributory negligence at 80%. The claimants appealed. The Court of Appeal held that a reasonable careful driver would have anticipated that there was a risk of a pedestrian on the crossing as the lorry was still stationary and the lights had only just changed. The appeal was allowed upholding the judges finding of 80% contributory negligence.

Convictions:

Q : Can you please tell me what a CD10 conviction code is ?

A : Driving without due care and attention. A comprehensive list of motoring conviction codes can be found by following the link in the right hand column.

 Excess:

Q : Why do I have to pay an excess when it was the other drivers fault?

A : When you took out your policy, you entered into a contract with your insurer in which you agreed to pay the first amount of any claim you make (usually for damage to your car). This applies irrespective of who is to blame. If you are not at fault, your excess, which is an uninsured loss, can be recovered from the negligent driver or his insurer.

Car Insurance FAQs (F-M)

Jumping The Queue:

Q : I was coming out of a side road and was struck by a vehicle jumping the queue. Who is to blame?

A : This sounds very similar to a case that came before the Courts some years ago – Powell V Moody (1966). In that instance, a motorcycle was jumping a queue of traffic on the wrong side of the road and collided with a vehicle edging out of a side turning. The Court held an 80/20 split with the motorcyclist being 80% to blame. Your case might not be identical to this but it will give you an indication as to what you might achieve.

 Limitation:

Q : My son caught the car of another driver whilst reversing over a speed bump into the space behind, to park. The damage to the car, was a very superficial mark to the door of the other car, but he still gave his insurance details. This was in September 2001. He didn’t hear any more, and assumed that the mark was so slight that it could be ‘T-cut’ out. However, this week (20th January 2002) he has received a notification of the other parties claim. Is there a limit to the length of time a party can have to put in a claim?

A : The other driver’s claim against your son arises out of the common law tort of negligence. There are time limits which are governed by legislation in the form of the Limitation Act 1980. However, they are very long! For property damage (as in this case) the limit is 6 years! (Had there been injury, it is only 3 years). This time limit starts from the date of the accident and applies to the date that civil court proceedings are issued naming your son as the Defendant. The best thing to do is put it in the hands of your son’s insurer and let them deal with it. Tell them of your reservations about the extent, or rather lack of it, of the damage to the other car.

Latent Defect :

Q : My car was parked in a Golf Course. A Council tractor was parked at the top of a slope. It slid down the slope and hit my car. The insurance company deny liability saying it was caused by a puncture they could not have foreseen and was a “latent defect” so have not been negligent.

A : If they want to prove latent defect, they will have to produce service records to show that the vehicle was properly maintained. I would have thought a vehicle with a puncture was less likely to roll than one with good tyres! What happened to applying the handbrake or putting it in gear? Or were these defective as well?

Motor Insurers Bureau:

Q : I was wondering whether you could advise me on my situation. A couple of weeks ago, one night a drunken driver hit my car full on (and is now a write off) I only have third party insurance (I am a student). The driver has no insurance and cannot pay anything towards the cost as he is also unemployed. Is there any form of compensation I can get?

A : I hope the police have prosecuted the drunken driver! The answer to your questions is a cautious ‘yes’. You can apply to the Motor Insurance Bureau for compensation. Some details of their activity is shown on my web site or you can go to their web site. However, for property damage (i.e. your claim is for your car and not personal injury) there is a huge excess to pay so if you car was quite old and not of high value, it might not be worth your while.

Q : My wifes car was recently hit by another car on a roundabout. The other driver sped off without stopping. Fortunately my wife was unhurt but the front offside wing of the car was badly damaged. My wife managed to get the first 4 digits of the licence number & the colour of the car but not the make or model. This was reported to the police who “attempted” to track down the owner of the other vehicle but without success and suggested we try the MIB. The MIB site seems to suggest only death or injury is covered. Is it worth trying to pursue a claim if the cost is likely to be close to excess or should we take the hit on the no claims?

The MIB have two separate agreements with the Govenment, the first provides compensation to the victims of uninsured drivers. Here owing to EU legislation, the compensation includes property damage. However, the second agreement – for untraced drivers, is for personal injury and death only. So I am sorry to say that in the circumstances you describe, there is no point in trying to pursue a case against the MIB. You will either have to take a hit on your no claims discount or withdraw your claim and pay for the repairs yourself, whichever is the cheapest option for you.

The cheapest prices for UK car insurance are found on price comparison websites such as Instant Online Insurance

Car Insurance FAQs (N-S) 

New Claim Notification:

Q : I was involved in an incident recently where there was no damage to my car, other than scuffmarks. Do I still have to notify my insurance company?

A : You should notify your insurer. The policy conditions say that you must report it but the choice of whether to claim is down to you. You could report it ‘for information purposes only’. That way they would at least know of it if they were approached by the third party directly. If you don’t you might breach policy conditions and your insurer refuse to deal with the third party damage.

 No Win No Fee :

Q – What is No Win No Fee

Legal Aid was replaced for personal injury litigation by Conditional Fee Agreements – the so called No Win No Fee. You ask a solicitor to pursue a claim against someone you blame for your injury. They evaluate how good your case is and enter into a Conditional Fee Agreement. You will need to ask your solicitor for full details of the agreement and how it works. Some schemes will deduct a fee from your damages some will not.

Police – reporting to:

Q : If you have an accident in which someone is injured, do you have to report this to the police?

A : The answer is ‘yes’. You should report it at the time of the accident but it must be reported within 24 hours. They will also check your RTA certificate of insurance which must also be produced to them within 7 days. (If you haven’t got it with you when you report, they will serve you with an ‘HO/RT1’ form\line demanding sight of it). However there is the new MID (Motor Insurers Database) and the police can check your insurance on this computer system at the scene of an accident. Failure to report it or failure to produce the RTA certificate could result in criminal prosecution.

 Road Tax:

Q : Is the insurance policy still effective if I haven’t taxed the car?

A : The answer to your question is ‘yes’. There are no standard terms or conditions in your motor contract that says you must tax your car. They might not be that happy though! However, if you use the car on the road without tax that is a criminal offence for which you could be prosecuted. If you do not plan to use your car on the road for some time, i.e. it is ‘laid up’ and kept off the public highway, then not only could you save money on not taxing it but you could also ask your insurer to reduce cover to ‘laid up fire and theft’. This would mean returning your certificate of insurance and then you would not be covered if you took the car out on the road.

Smoke damage:

Q : There was a lot of smoke but all that was damaged was the wiring loom. Why will you not pay my claim?

A : Where the wiring loom has sustained damage by an electrical breakdown, but there were no flames as such, there has been no fire. Just an electrical fault. These are excluded by the policy. So, sorry, but you will have to pay for the repairs to the wiring yourself. If the wiring loom has set the rest of the car on fire, then that damage can be paid for by the policy (assuming you have at least ‘third party fire and theft cover’). Strictly the wiring loom should not be paid for but it might not make any difference if the rest of the damage renders your car a total loss.

 Same Insurer:

Q : I was hit by another car and although the other driver was clearly at fault and I have a witness, the other driver denies liability. The trouble is, we are both covered by the same insurer. So I think it is impossible for them to represent me impartially.

A : When I have been in this position, I have relied upon the witness evidence, when available, to make an impartial decision between the two clients. However, if you feel you are not being treated fairly, then you have the option of using the Financial Services Ombudsman or commencing an action in the “Small Claims Court”.

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Car Insurance FAQs (T)

Theft:

Q : Perhaps you can help me with a specific theft claim I am dealing with at present. Do you know of any recent motor theft cases where the keys were left in the vehicle and the claim was won by the claimant? Also what constitutes unattendence of a vehicle – what is the distance from the vehicle where it is considered to be unattended? I would really appreciate any cases you can throw up and advice you may have.

A : Richard Leighton Haywood V Norwich Union Insurance (1999). This one is bad news. Originally, the Court ruled in favour of the claimant but it went to the Court of Appeal in 2001. They held that the clauses were clear and that the claimant had breached the policy wording about leaving the car unattended etc. My advice is NEVER EVER leave your car unattended, unlocked and with the keys in it! Previously, an insured failed to take reasonable care only if he was reckless, and not if he was merely negligent (Sofy v Prudential Assurance Co Ltd (1993) In my view, each case will be looked at on its merits. You need first to check out the precise wording in the policy. This one had a specific exclusion relating to leaving keys in the vehicle. Some do not and you might only have to battle a ‘reasonable steps to safeguard’ condition. Then you have to look at the facts of the case, where did he leave the vehicle (e.g. on his driveway? on a public road? in a petrol station?) How far away was the insured? Did he have his back turned or was he inside a building? How long had he left it? Was the engine running? Thus you might manage to succeed if he had just stopped at a post box. But if your client had left it for some minutes on a public road, unattended, unlocked and with keys in ignition, then I doubt you will overcome the policy conditions and exclusions.

Q : My car has been stolen, Will it affect my Bonus?

A : This depends on three factors. One, do you have a ‘protected’ bonus? If yes, you are okay provided you make no more claims. Two, is the thief caught and does he have the means to pay for your car? Probably Not! Three, is your car found undamaged – hence no need to claim? REMEMBER – your bonus is a ‘NO CLAIM BONUS’, not a no blame bonus. In general if you make a claim and your insurer pays out, it is recorded on your record as a claim. In the vast majority of theft cases, the claim will affect your bonus.

Total Loss – there are many questions about total loss claims and salvage

Q : My car was a total loss, can I reclaim part of my premium? I do not intend to replace it.

A : The answer is NO. When your insurer pays out your total loss claim they have discharged their contractual obligation to you. The phrase they might use is that your policy has ‘discharged by performance’ Basically your side of the deal is you pay the full annual premium, their side of the deal is to provide you with the protection specified in the contract. They have kept to their part of the deal. To keep to yours, you must pay the full annual premium.

Q : What happens if you disagree with their value?

A : This is probably the single most common problem with a total loss claim. Do insurers quote a lower value expecting to be negotiated upwards? They certainly used to. Some might still do so. But many insurers now give you the value that they genuinely think is correct for your car and do not expect to negotiate further. If you don’t agree their value you will have to come up with some pretty convincing evidence to prove their engineer is wrong. I suggest you consider the following:
1) Buy a guide in a shop (there are usually one or two in the stationers) and look up the quoted pries for your car. Make sure you look up the right model! These figures will be close to those available to the insurers engineer.
2) Check out the ads in your local papers and car magazines. See what similar cars are being advertise for.
3) Check out your local dealers and see what they claim to be selling cars like yours for.
4) You might have to consider appointing your own independent engineer to value the vehicle.
5) Talk to your insurers (without losing your ‘cool’). Ask them to justify their value and how they calculated it. Then use your evidence to throw doubt on their value and justify your own value. REMEMBER – car dealers put excessive prices on the windscreens of the vehicles they have on their forecourt. This gives them some room for negotiation with both the price of the car they sell and the trade in, if any. So don’t start with an inflated opinion of your own cars worth!! And remember, your insurers will only pay the market value of the car, not all the extras your local dealer will throw in such as the cost of the ‘free’ warranty.
If you are still not happy with any revised value given to you, you can complain to your insurers General Manager or submit your complaint through your insurers complaints procedure. With most insurers this will be the Insurance Ombudsman Bureau. The insurers will weigh up the cost to them of a case being reviewed externally against the disputed values. The chances are that, unless you are being unreasonable, you will win. Any review will again look at the ‘book values’ so don’t expect to receive more than the guides quote.

Q : I kept the vehicle documents in the glove box – can you deal with the claim without them?

A : You must obtain duplicates. The V5 (registration document) can be obtained from the D.V.L.A. Forms are at your post office. The garage who did your MOT can supply a duplicate upon request. Needless to say there will be a charge for these. Without a V5 your insurer will not settle your claim. Without a current, valid, MOT, your insurers will still settle but will reduce your value. Would you buy a car over 3 years old that had no MOT and expect to pay the full price for it? Come on! Of course you wouldn’t – so don’t ask your insurer to. What if they won’t pay you more than the ‘insured value’? When you took your policy out, your insurer will have asked you for the value of your car. With the vast majority of cars that figure will not have influenced your premium. But it does influence the value you might receive for a total loss or theft claim. If you have undervalued your car so that the ‘insured value’ is less than the true value, your insurers will only pay out the ‘insured value’. My advice, if they do this, and provided the difference is not that great, kick up some fuss – assertively but gently. If you can show that the notified value was an error either by them or by you; there was no attempt to deceive them and that they have not been prejudiced in anyway by this ‘nondisclosure’ the chances are they will relent. If they don’t, you have learnt a lesson and you should change insurer to a more customer friendly one. Of course, if you are insured via an insurance broker then you can ask your broker to do all this for you. It is one of the advantages of having a broker – when you have a dispute with your insurer, they will usually take your side and can pull favours for you that you can’t pull when you insure with one of the direct insurers.

Q : I want to keep the salvage. How can I do this?

A : My advice is DON’T. Most insurers are very reluctant to do this these days. You will cause yourself a lot of unnecessary hassle and difficulty. If you do so, what will you do with it? Will you repair it yourself or get a friend to make a ‘dogs dinner’ of repairing it with parts from a scrap dealer? What will you gain? I would suggest a car that has seen some serious ‘action’ and probably a bodged up repair on the cheap? Is your life that cheap? Where the damage to the car is such that it does not fall into the ‘break it up’ categories of salvage, Insurers will assume you to settle the claim by way of cash with the salvage, will then get a friend or local garage to fix it up on the cheap and pocket the difference as profit. They do not like their customers trying to make a profit out of them! Further, there has been a lot of criticism in the past by the consumer media of the insurance industry for letting seriously damaged cars back on the road. Insurers only deal with registered salvage dealers and some now have their own salvage companies.

Q : What if my car is old, I am on a pension and can’t afford to buy another one?

A : In theory the value you receive from your insurer should be enough for you to find a car of the same make, model, mileage, condition for the money they pay you. You and I know that, in practice, this does not always work out. I have had conversations with insurance motor engineers where they have stated quite openly that they like to get the old cars off the road. So when looking at the cost of repairs V value of the car, they take into account new parts at full manufactures list price and labour rates from the main dealerships. EXPENSIVE. I propose two possible solutions.
No 1: Go to a local reputable garage and ask them to quote a ‘contract repair’ figure using non-standard parts (e.g. Halfords brand) or decent second hand parts. This price might well make it a viable repair and your insurer can then be persuaded to authorise this contract repair for you. A contract repair is where the garage agree to repair a car for a fixed sum, say £1000, rather than repair it based on an agreed labour charge plus parts at list price and VAT. e.g. £250 labour. The parts and labour and VAT are all included in the £1000.
No 2: is to pay the extra yourself if the difference between the total loss value and the repair is not that great. This second option will cost you some money but at least you will retain your car, properly repaired, and perhaps at less cost to you than buying a newer car.

Q : My car was ‘written off’, you kept the salvage and the other day I saw it drive past my window. Please explain!

A : Insurers are a business that want to make a profit. To do so they need to keep a check on the cost of claims settlements. Thus, even with the criticism of the consumer media they allow their salvage dealers to pass cars on for repair and resale. They get a better deal on the sale of the salvage. Whilst a few brave insurers have declared they will break all salvage with so many motor insurers in the market, this will not become standard practice without legislation, strictly enforced code of conduct from the ABI, or a means by which the insurer sees this option as being better value in some way to them. Until then, you can expect this to happen from time to time and there is nothing you can do about it.

Q : You kept my salvage, against my will when you settled my claim the other week. I have now received a notice of a parking fine not paid. What do I do?

A : This follows on from above, where the salvage has been repaired and the car has found its way on to the road again. Fortunately, it does not arise very often! On the back of the form you receive, there are some fields you can fill in to say that the car is no longer yours, that it has been sold on to your insurers. Fill this form in and return it. Keep a copy. You might even persuade your insurers to fill it in for you!

Car Insurance FAQs (U-Z) 

Uninsured Losses:

Q : Have looked at your site with great interest and have a question to pose for your FAQ section. My car was a total loss after an accident and was not my fault, is it possible to claim (under uninsured losses) for the further expenses incurred in replacing the car? Eg time off work, vehicle history checks, inspections, hire car.

A : You can reclaim any reasonable expense that a court would award you. Assuming you are making the efforts to replace the car whilst awaiting the settlement cheque, the costs involved in finding a replacement for your car could come under ‘general inconvenience’ and car hire is certainly claimable. Where you can produce a receipt or documented evidence of a loss, such as an invoice for car hire, you should not experience any difficulty. Where you are claiming for general inconvenience, the figure is usually negotiable. Some third party insurers will be more generous than others.The problems start to arise when you claim for costs incurred after you have been sent the cheque for your total loss value. Insurers seem to think that you can then wave a magic wand and a replacement car just appears. i.e. they are more reluctant to pay up for losses incurred at this stage. At the end of the day, if you don’t get what you think you should, go for a hearing in the small claims track of your county court.

Q : I am writing with regards to claiming for Loss of Vehicle use resulting from a Road Traffice Accident. I would appreciate it if you could provide information as to the rates at which u can claim, for loss of vehicle use per day.

A : The rate is usually negotiable. In my experience, most reasonable insurers would settle at £10 a day/£70 per week for short term loss of use. If you are looking at longer term then £50 a week would seem reasonable. If you want more, you would need to be able to justify it.

Value:

Q : Why do I have to accept a total loss when my car could be repaired for more money?

A : This question was considered in the Courts some years ago. Darbyshire V Warran (1963) held that an owner of an old car cannot expect to have it repaired at a cost greater than its market balue unless the car is uniquie and irreplaceable and where the car is readily replaceable, the measure of damage shall be the vehicle’s market value.