Car Repairs: Your Insurance Choices

Navigating Car Repairs: Your Insurer's Role

When your vehicle suffers damage, be it from an accident, vandalism, or another covered event, the subsequent repair process can feel daunting. A crucial decision you'll face is how to manage the claim and subsequent repairs. While your insurance policy is designed to protect you, understanding the nuances of how insurers handle repairs is paramount to ensuring you're not left out of pocket or with a subpar fix. This article delves into what happens when your car is repaired through your insurer, exploring the terms, your rights, and the potential pitfalls.

Claiming Through Your Insurer: The Contractual Obligation

When you opt to claim through your own insurance provider, you are essentially entering into a contract, and its terms and conditions become your guiding principles. Your insurance policy is designed to INDEMNIFY you. In simple terms, this means your insurer's obligation is to restore you to the financial position you were in immediately before the loss occurred. You should neither be better off nor worse off financially as a result of the claim. Your insurer can fulfil this indemnity in a few primary ways:

• Repairing your car: The most straightforward method, where the insurer arranges and pays for the necessary repairs.
• Providing a cash settlement: In some cases, the insurer may offer you a cash sum equivalent to the cost of repairs. It's important to note that this settlement amount might not necessarily reflect the exact cost the insurer would pay their chosen repairer.
• Dealing with your vehicle as a total loss: If the cost of repair exceeds a certain percentage of the vehicle's market value (as defined by the insurer), it may be declared a total loss. In this scenario, you would typically receive a settlement based on the vehicle's pre-accident market value.

It is VERY VERY important to thoroughly read and understand your insurance contract and its terms and conditions before lodging a claim. You might uncover clauses you weren't previously aware of. For instance, some policies may stipulate a lower level of cover for windscreen replacement if you choose a repairer not on the insurer's approved list. This can be particularly significant for newer vehicles equipped with advanced driver assistance systems (ADAS), which often require precise calibration following windscreen replacement. Failure to use an approved supplier could lead to additional costs or voided warranties for these systems.

Furthermore, insurers may attempt to impose an additional excess if you insist on having your car repaired at a repairer of your own choice. While you generally have the right to choose where your vehicle is repaired, insurers often try to steer customers towards their network of approved repairers, where they may have negotiated preferential rates. Understanding these clauses and your rights is crucial.

When the Accident Isn't Your Fault

The landscape changes significantly if the accident was not your fault. In such circumstances, you possess greater entitlements than if you were claiming under your own policy. Your insurer is legally bound by the Financial Services and Markets Act 2000, and specifically by regulations within the Financial Conduct Authority's (FCA) handbook, known as ICOBS (Insurance Conduct of Business Standards). These regulations prevent your insurer from acting in a way that conflicts with your best interests. This means if you have a valid non-fault claim, you have the right to pursue the at-fault party directly or through their insurer.

Consider this example: A client owned a classic Aircooled Porsche 911, a vehicle whose value had appreciated significantly over the preceding five years. The car was insured under an "Agreed Market Valuation Policy" for £40,000. However, due to rapid market appreciation, the car's actual value had surged to £60,000 within a year. The client was involved in an accident that was not his fault. His insurance broker advised him to claim through his own insurer. To his dismay, he received only the agreed market value of £40,000. He lodged a complaint with the Financial Ombudsman Service, but the ruling was against him. The Ombudsman found that his insurer had met its contractual obligations by paying out the agreed market value.

Had the client pursued the claim directly through the at-fault party's insurer, a claims management company, or a solicitor specialising in such cases, he could have potentially recovered the full £60,000 market value. The moral of this story is clear: conduct your own thorough research and seek advice from multiple reputable and qualified sources before proceeding with a claim.

Pros of Claiming Through Your Insurer

There are certainly advantages to using your own insurer to manage your repairs:

• Speed and Efficiency: Your insurer will generally act more quickly and process payments faster. This is particularly beneficial in cases where liability is disputed following an accident with another party. Your insurer can manage the liability issues with the other party's insurer in the background while ensuring your vehicle is repaired or you are compensated promptly.
• Guaranteed Repair Up To Market Value: Your insurer should be advising that they will repair your vehicle up to its market value. You can, and should, insist on this if it is the case.
• Your Choice of Repairer: Remember, you have the right to choose your own repairer. Do not let your insurer dictate otherwise. While they may have preferred repairers, you are not obligated to use them.
• Convenience: If you follow their procedures, the process can be relatively hassle-free. They handle the communication with the repairer and manage the payment process.
• Dispute Resolution: Should issues arise during the repair process, you have the right to complain. You also have avenues for arbitration and can escalate your complaint to the Financial Ombudsman Service, who provides an independent dispute resolution mechanism.
• Repair Guarantees: Insurers' approved repairers may offer longer guarantees on the quality of their workmanship compared to independent repairers.

Cons of Claiming Through Your Insurer

However, there are also potential drawbacks to consider:

• Limited Choice of Repairer: As mentioned, insurers often push for their approved repairers. While you have a choice, insurers might make it less appealing by imposing higher excesses or longer waiting times for non-network repairs.
• Potential for Substandard Parts: Approved repairers might be incentivised to use non-original equipment manufacturer (OEM) parts to reduce costs, which could impact the long-term performance and safety of your vehicle.
• Impact on No-Claims Bonus: If you claim for an accident where you are not at fault, your no-claims bonus could still be affected if your insurer cannot recover the full cost from the at-fault party's insurer.
• Underestimation of Value: In cases of classic or modified vehicles, insurers might not accurately assess the true market value, leading to an inadequate settlement if the vehicle is written off.
• Increased Premiums: Even if the claim wasn't your fault, making a claim can sometimes lead to an increase in your insurance premiums at renewal, as insurers may view you as a higher risk.
• Loss of Direct Control: While convenient, claiming through your insurer means you relinquish some direct control over the repair process. Communication and decision-making often go through the insurer, which can sometimes lead to delays or misunderstandings.

Alternatives to Claiming Through Your Insurer

Given the potential downsides, it's worth exploring alternatives, especially for non-fault claims:

• Directly with the At-Fault Party's Insurer: If you know who is at fault and have their insurance details, you can contact their insurer directly to manage the claim and repairs. This often bypasses the need to involve your own insurer and can protect your no-claims bonus.
• Using a Claims Management Company (CMC): CMCs can handle the entire claims process on your behalf, often securing like-for-like replacement vehicles and managing repairs with your chosen repairer. They typically work on a commission basis, deducting their fee from the settlement or charging the at-fault party's insurer.
• Solicitor Representation: For complex claims or significant injuries, engaging a solicitor can provide expert legal advice and ensure you receive the maximum compensation.

Key Considerations for Your Vehicle's Repair

Regardless of how you choose to manage your claim, keep these points in mind:

• OEM Parts vs. Aftermarket Parts: Always ascertain whether your insurer or their chosen repairer intends to use Original Equipment Manufacturer (OEM) parts or aftermarket alternatives. OEM parts are made by the car manufacturer or their authorised suppliers and are generally considered superior in quality and fit.
• ADAS Calibration: If your vehicle has ADAS features (e.g., lane assist, adaptive cruise control), ensure any windscreen replacement or bodywork repair includes the necessary recalibration of these systems. Incorrect calibration can compromise safety.
• Repair Guarantees: Enquire about the warranty provided on the repairs. Reputable repairers, whether insurer-approved or independent, should offer a guarantee on their workmanship.
• Documentation: Keep meticulous records of all communication, repair invoices, and parts used. This documentation is vital if any issues arise later.

Frequently Asked Questions

Q1: Can my insurer force me to use their approved repairer?
No, you generally have the right to choose your own repairer. However, your insurer may try to incentivise you to use their network by offering lower excesses or faster service.

Q2: What happens to my no-claims bonus if the accident wasn't my fault?
If your insurer successfully recovers all costs from the at-fault party's insurer, your no-claims bonus should not be affected. However, if there are delays or disputes in recovery, your bonus might be temporarily impacted.

Q3: Should I accept a cash settlement or have my car repaired?
This depends on your circumstances. A cash settlement gives you flexibility, but you must ensure the amount is sufficient to cover the repairs adequately. If you are unsure, having the insurer manage the repairs directly can be simpler.

Q4: What if I'm unhappy with the repairs done by an approved repairer?
If you are dissatisfied with the quality of the repairs, you should first raise your concerns with the repairer. If unresolved, contact your insurer to lodge a formal complaint. You can escalate the matter to the Financial Ombudsman Service if necessary.

Q5: How do I ensure my car's value is correctly assessed if it's declared a total loss?
Research your car's market value using reputable sources like valuation guides, online car sales platforms, and specialist classic car valuers. Provide this evidence to your insurer to support your valuation.

Ultimately, understanding your insurance policy and your rights as a policyholder is key to navigating the car repair process effectively. By being informed and proactive, you can ensure your vehicle is repaired to a high standard and that you receive fair compensation.

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