Do you always lose out on car insurance?

[AlumhurstRoad]

So three years ago I bought my "dream car" with the lump sum of my pension pot for £5,250. It was hi-spec, low mileage, full service history, one owner. Since then I have driven it at weekends and have looked after it well. Similar vehicles are currently available on Auto Trader for about £4,500.

I have not been involved in any accident for over 30 years, and that was in a company car. In my own name I have 17 years no claims bonus, the last 13 years with the same company.

A few weeks ago on a dual carriageway, I was slowing to 30 to stick to a speed limit as advised by an overhead gantry, and the car behind ran into the back of me. The impact caused sufficient damage for the insurance company to write the car off, against my wishes as I wanted it to be repaired.

However, the most the insurance company are prepared to offer me is £1,500, being calculated as £2,350 "market value", less £350 excess, less £500 salvage (numbers have been rounded to avoid identification). The remaining £1,500 is not enough to purchase a replacement vehicle, nor is it enough to repair the car, so basically I have lost my vehicle.

Is this a normal result from a "no-fault" accident? I'm feeling pretty fed-up as I have been with this insurance company since 2009 and never made a claim until now. I was expecting them to "look after" me and repair the vehicle, and instead they have scrapped the vehicle and cancelled my insurance.

Has anyone been in a similar situation and were they able to resolve it?

Thanks @Oblomov22, yes I have been fighting, it took them 9 weeks to make their offer. I just feel so incredibly let down having been with the same company for so many years without ever making a claim.

@Dotjonesthanks for your reply, could you point me in the direction of a specialist insurer? My policy is due to renew soon.

Gap insurance is usually for finance agreements

When is Gap insurance needed?
We think Gap insurance can be useful and is therefore worth thinking about – but it won’t make sense for everyone.
Generally speaking, Gap is likely to be worthwhile in the following situations:
You used a large loan to buy your vehicle

Gap insurance can offer a means of paying off outstanding finance on your car, which means if your car’s stolen or damaged beyond repair you won’t have to continue to make payments on it.

You’re concerned about the depreciation of your vehicle
The quicker your car loses its value, the less your insurer will pay after a total loss incident, compared to what you paid for it. Gap insurance means you’ll get more back.

Your car is on a long-term lease
If you have a long-term rental agreement for a vehicle with a mileage allowance, a write-off could leave you without a car and a bill for thousands of pounds. Gap insurance can help protect against this.

So you agree @SofiaSoFar is right and you were wrong. You categorically stated it is for financed vehicles and are now saying it's usually for finance. It's not, it's for anyone who doesn't have RTI cover on their motor insurance, regardless of how they've funded the purchase.

I wouldn't buy a car on finance without GAP, but TBH, I wouldn't pay cash for a car without it either. Too many idiots on the road to risk a shortfall, but as I say, I'll get my boss to contact our compliance officer and the Financial Conduct Authority to tell them to change our compliance procedures because some random on MN claims to know better.

Yawn... go you!!

most gap insurance is taken for finance cars - happy now??

Your life must so boring

Yep. We buy our cars outright 9 times out of 10 and always take out GAP, as do most people I know.

And the 'vehicle replacement plus' cover is brilliant, isn't it - even better than RTI - as it covers the difference to get a brand new equivalent car even if there's been a complete model change since your car was built. That can be a really big sum of money 3 or 4 years later when a new model has come out.

Sorry to resurrect an old thread, I'm still not having any joy with the insurance company. They've increased their offer by £90 but there is still a shortfall of almost £3,000 compared to a replacement vehicle of the same year / model / mileage. They are saying that you pay the excess whether the accident is your fault or not? Does anyone have any ideas? Thanks again.

The advice in respect of the excess is correct, though you should be able to get that back once the other side accept liability either:

• your insurer will reimburse you once they receive confirmation of acceptance of liability (they'll include it in the amount they recover)
• if you have legal expense cover on your policy; they will do it for you.
• you can phone the other insurer and request it (they'll just require proof it was deducted from your settlement- your insurance can provide you with this)

If you're still not happy with your offer you need to escalate via their complaints process & then via the ombudsman if still not resolved satisfactory. That could take months to go through though.

You can always accept payment of what they're offering on an interim basis though (make it clear it's only on interim and not full & final) if you need money in the meantime.

Might be worth getting a valuation elsewhere or ask them to evidence theirs.

Ignore the rest. This is someone who knows. I also did quite a few years in Insurance Claims in a past life.

The valuation is an OFFER. If you dont agree with it, it takes seconds, minutes at most to do a autotrader search of similar cars on forecourts for sale. Screen print and send them to insurer. Base them on forecourt sales rather than private as they should be more expensive and you need as much as possible to replace.

The excess is part of your uninsured losses. Your own insurers will be chasing for their own loses so reques that your excess is included. If they wont, just make contact with other insurers and they should be accommodating. Its not difficult unless you want it to be.