Increased premium from non fault accidents

[IanS]

Just thought I would post this as I still can't believe its true. Admiral insurance are the insurers. I got a renewal through from my existing insurer showing an increase of £250.00. I had reported 2 accidents to them, one accident was dealt with direct by the TP insurers and my insurer kept in the picture. The other accident claim was screwed up by my insurer's incompetence in obtaining vital video evidence. I have withdrawn this claim and cancelled renewal as a result. There are no claims from TP's and my policy will stay claims free.

When my renewal came through, I also received on-line quotes from Money Supermarket based on my details a year before. The most competitive was Admiral. When I phoned them to update particulars, the quote increased, even though I explained the accidents were non fault. I wrote separately to Admiral and below is the response.

I am writing in response to your letter in regards to increase in your
premium. From looking at your online quote I can see that there were
no claims or accidents declared. On your policy we have 2
claims/incidents recorded which would increase your premium as we
rate on both fault and non fault accidents regardless of whether a
claim was made.

If this is true, this means that whether or not you are the innocent party in an accident, your premium will go up even if you have not made a claim!
I don't know if I have got this wrong but I have written to the Ombudsman and the ABI for an explanation. I've invested in 3 car DVR's because of a dispute in the first of the 2 accidents, it paid dividends by getting the TP insurer to settle direct on the second accident. What is the point of fitting this gear if we are going to get hit anyway?

 

[IanS]

I have had a reply from the ABI and it is correct that your premium will be increased even if your accident is non fault and you didn't claim off your insurer. See below the ABI reply to my e-mail,

Many but not all insurance companies (we do not have details) have research
that shows that people who have non- fault accidents are more likely to have a
claim than someone who has had no claims of any kind. Hence they are considered a
greater risk and a higher premium is charged.

How's that for a kick in the teeth to those who fought a claim against a TP or TP insurer which saved their own insurer the trouble of dealing with a claim and recovering the cost from the other side.

I still can't believe it!!!

 

[stevenwiki]

I think your premium has increased because your history (and therefore your profile) has changed - a no fault incident on your recent history makes you more of a risk (in their eyes) than no incidents at all.

 

[IanS]

So, if I just happen to be stationary at red lights and hit by a driver who isn't paying attention and the car next to me doesn't get hit, I'm a worse risk than the person next to me and considered a risk perhaps as bad as the person who hit me.
Is someone whose house gets damaged by a car, a greater risk than someone whose house isn't damaged, keeping location out of the equation.
I think the application of this extra cost in premium is a bit dubious and ill thought out.
It will be interesting to see what happens when insurers get hit by claims to recover this increase in premium, by the non fault motorist and what it does to their claims costs.
I have been able to get a quote from an insurer who doesn't apply these terms. Premium is £250.00 compared to £297.86 from Admiral and £502.00 from my current insurer LV. In the circumstances, I don't have an extra "loss" to recover.

I'm inclined to call this additional cost, "Application of the Luck Factor".

 

[ALewis]

Possibly Ian, but I guess you'll just have to be glad it's not a £1800 premium... The joys of being a male under the age of 25...

 

[IanS]

Yes, I am glad my premium is low in comparison, although I suppose it was similar in real terms when I was young.

 

[ALewis]

Well yeah... All I can say really is that insurance companies will try anything to get more money out of you. Their reasoning doesn't make sense in real life situations - unless its to stop kids whom may be involved in a car crash (and therefore drive a damaged car), and therefore think 'sod it, I don't care if I crash'?

 

[IanS]

Having thought a bit more about this issue and working on the basis that the Third Party whose at fault, is responsible for your costs as the innocent party. In which case the Third Party insurer should pay this. If there is a refusal which I'm sure there will be, issue against the Third Party direct in the small claims court and the Third Party insurer will then have to decide to defend the action at some cost to themselves.

You will need to know the precise amount of the increase in your premium and therefore you should ask your insurer for this at each renewal as it will affect your premium for 5 years, at each renewal there will be a claim against the Third Party. Notify the Third Party insurer that you will be making these future claims, they won't agree of course, but they need to be told.

If everybody who has a non fault claim did this, I reckon the practice would stop. Have I missed a legal point anywhere? Am I in cloud cuckoo land?

 

[ALewis]

Hmm... I see how your looking at this. And this is whats called a 'consequential loss'.
However. As far as I'm aware, you can only claim for consequential losses where a contract, or its terms have been breached (and you don't have a contract with the third party insurer.

Although I do know that you can claim for consequential losses where somebody fails in their (implied / expressed) duty of care towards you. And therefore, you could potentially claim for that (as a duty of care exists to other road users).
But now I'm a bit too far out of my depth, I'd have to sit here with law books out and search for any cases, but its a possibility as its civil law...

Just do some research on the Law of Negligence, specifically Duty of Care. And try to find some cases on the matter.

The only thing that's giving me question marks is because its mixing civil laws with private insurances, and the fact that an insurance company doesn't HAVE to sell you insurance, they can just say no (thats contract law for you).

Adam

 

[IanS]

Hi Adam,

apologies for the wrong term, it is consequential loss.

I hope someone tests this soon, it's going to be interesting, it could open a can of worms. My son and I have fitted DVR's to 3 of our cars so far, 1 to go. I've got 2 coming for my other son and his wife.

The 2 non fault accidents this year involve my youngest son and his wife, 6 months apart. The first accident was caused by TP cutting across my son to the TP's left, from a right turn lane. I won't go into detail but to say my insurer screwed up by dragging their feet getting video evidence that my son had organised from a bus company, through the police. Hence reason for DVR's.

The second accident was exactly the same scenario but at a roundabout. Both the TP's lied but we had the second one cold with the footage. There's a mini camera to the rear which is helpful too.

 

[ALewis]

Hi,
There's no need to apologies! Most people don't know a thing about terminologies or even what laws exist - and we don't mind educating (clearly)
Well what can I say, you don't get much luck on the road do you? Maybe you should get a few of those inflatable kids pools too, and tie them around your cars

Instead of waiting, why not give it a go yourself, a few letters back and fourth, it may cost 50p a stamp, whats there to lose? £2 and some time?
Or you could go see one of these 'no win no fee' solicitors - and take the free hour appointment, see what they have to think about the idea. And if they think its doable , do it yourself (its civil law after all)?

 

[IanS]

My son will be back from France next week and once we've discussed the issue he might want to take over. It's really both him and his wife that have caused this problem, they have use of my Honda CRV when I'm not using it to tow with and are named drivers on my policy.

There's always the renewal of his own car's insurance, I'll get him to ask his insurer for the precise increases relating to these incidents and perhaps he will go for it. There must be somebody out there who has already been down this road. I might trawl the internet forums to find out, I'm sure I spotted something on the RAC forum.