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Ex-Hasbeen

Car Insurance Question

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My daughter had an accident a couple weeks ago, and wrote the car off. She was not at fault, so had no excess to pay, but when she got the cheque it was about $1k lower than expected. What it was, was that the insurer deducted the next 10 months worth of premium payments. This is all legit by the PDS

 

 

Your insurance cover will cease as soon as we accept liability.

Because we will have met our obligation to you in full:
o if you have paid an annual premium, we will not return
any premium you have paid for the period after the
date of insured event, or
o if you are paying your premium in monthly instalments,
there will be no return of any part of an instalment
you have paid and we will deduct any remaining
instalments from the amount we pay.

 

but it strikes me that she is now $1k down for an accident that is not her fault.

 

Is there a way that she can recover this amount from the other party or their insurer?

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I don't think so. It's the same when you pay 1 year and crash day 1. Sunk cost I think. Rip-off of course.

Edited by Mjainoz

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I'd be pursuing it through the other party and their insurance. If you cancelled the insurance due to selling the car, you wouldn't have to pay for the full year. I don't really see that much of a difference if the accident was not her fault

 

Slightly different but when I had my motorbike accident a few years back and wrote it off, didn't have anything like this, so doubt it is on all policies

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Is her insurance paid monthly?

If she paid yearly she would have paid the full amount at the start. So I guess this is what they are thinking?

I've never written anything off so can't really say. But it's not like insurance companies to do anything that would benefit you if they didn't have to.

Does this mean when the car is replaced that she has 10 months of insurance already paid towards it? I bet not.

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threaten to go to the car insurance ombudsmen if there is one. most insurances would refund any premiums you had paid in the month of the accident, not charge you for the future. don't accept it. also, you should name them.

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She pays monthly, but the PDS that I quoted above (note the bold section) says that they will deduct the future installments from the payout. I have no illusion that she'll get anything from her insurer, however would it be likely that she could successfully demand her loss from the at fault party?

 

Note, I checked my policy and it has the same clause.

 

edit to add: I just checked a couple more companies, and they all have the same clause. It may be worth checking yours.

Edited by Ex-Hasbeen

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my ex only had third party. an idiot from the racq ripped the guts out of the front of it when she had to get towed once. it was a nissan exa with a fair bit of plastic moulding. the insurer wrote it off and she told them to get stuffed with the offer they made and they bumped it up a bit. she paid monthly but the insure was Shannons, so they may be better.

 

the thing is you can cancel your insurance anytime if you pay monthly and they don't charge you for the remaining payments for the year. if you had paid upfront they definitely used to give you a refund.

 

looks like daddy may have to help in this case. no new bike for you unfortunately.

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Had 2x cars written off and didn't lose any money for future payments. Had fully comp though (which should be mandatory).

 

Sent from my SM-G930F using Tapatalk

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I think that the idea is that any replacement car will be insured under the same policy, or a new policy under the continuation of the policy that resulted in the settlement.

 

I would talk to the Claims Agent and, if there is no satisfactory result, their Manager and appeal to their goodwill. At the very least, ensure that you (your daughter) doesn't get penalised for the accident in her NCB.

 

Try and negotiate with the Claims Manager rather than threatening to go to the Ombudsman - they usually have a level of discretion and empathy and it sounds like you have restitution (less the $1,000 of course which is $hit).

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Tried talking to them. Their answer was,

 

"It says quite clearly in the policy, that in the event of a write-off, the policy is terminated, and the rest of the repayments come off the settlement amount. The same clause is in nearly every insurance company's policies, so it is not something that has not been looked at before."

 

He also told me that we could try a demand of the other party, but if they were the other person's insurer, and someone were to come to them with that request, they would be very unlikely to pay it

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Tried talking to them. Their answer was,

 

"It says quite clearly in the policy, that in the event of a write-off, the policy is terminated, and the rest of the repayments come off the settlement amount. The same clause is in nearly every insurance company's policies, so it is not something that has not been looked at before."

 

He also told me that we could try a demand of the other party, but if they were the other person's insurer, and someone were to come to them with that request, they would be very unlikely to pay it

 

A-holes.

 

Name and Shame them. Hashtag the hell out of it and hit social media .... they will be all over you like a fat kid on a doughnut!

 

Forget the Ombudsman, go straight to Facebook and Twitter!!!

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A-holes.

 

Name and Shame them. Hashtag the hell out of it and hit social media .... they will be all over you like a fat kid on a doughnut!

 

Forget the Ombudsman, go straight to Facebook and Twitter!!!

I think you are kidding yourself. It's the standard industry practice and it's plain as day in the PDS. I respect that it's not "right" but it's legal and is the norm. And every car written off has the same result.

 

Note. I'd love to be wrong. Happy to be proven so.

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Even if they remove the clause, chances are your market value just coincidentally shrank by the same amount anyway......

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Thats the trap with claiming on ur own insurance. If not at fault its pretty harsh. But technically correct. Pay by the month means part way through the year you havent paid for your policy in its entirety

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The theory behind is that the policy has been paid out and therefore cancelled / ended.

So, the write off in this case is the end of policy

I haven't worked in insurance for years, but this was the standard practice back then

She can issue a letter of demand to her insurer and see how she goes, but it's unlikely to get reimbursed unfortunately

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Jas just got her P's, so I had to add her as a nominated driver on the policy for her car.  Tripled the premium.  Holy shit........

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1 hour ago, goughy said:

Jas just got her P's, so I had to add her as a nominated driver on the policy for her car.  Tripled the premium.  Holy shit........

There are some insurance companies (e.g. NRMA, Youi, but not Budget Direct) where the premium will not increase with a young driver, but the excess payable if they crash it goes through the roof (e.g. from $500 to $2000+).  Those were the ones we went for when our kids started driving.

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1 hour ago, goughy said:

Jas just got her P's, so I had to add her as a nominated driver on the policy for her car.  Tripled the premium.  Holy shit........

I've got a manual, and the kids got/are getting auto licences. They can drive our lease car, but that is through work, and they don't differentiate by age. It's just an extra $500 if it's not me or my wife driving.

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Our daughter got her P's in Dec

the advise we got was don't list as driver and pay excess.

It worked out Abi had to crash each car twice a year to save money on the listed v increased excess

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I was thinking about the not listing thing.  We have been with the same insurance for ever so might be time to shop around anyway.

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Budget Direct are one of the cheapest for mature drivers, but when we tried to add our P plate daughter, it went through the roof.

Youi have been ok so far, and she even had to make a claim through them (though she was not driver at fault) and it worked out fine.  Like Rory said, paying the extra excess which is only triggered IF she has an at-fault accident works out cheaper than paying the extra premium. She is a listed driver with Youi, but it only impacts the excess, not the premium.

Also, the after first year, Youi increased the premium from $600 to $800+ & I rang them to say get real - the value of the car has gone down, why has the premium gone up so much.  So they reduced it back to $600, rather than lose us as a customer (we also have our house with them).  So they are willing to negotiate if you don't just cop the usual increases all insurance companies lump on each year.

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Definitely time to shop around. We are with SGIO, when we added the P plate kids there was no premium change, The excess was increased for them.

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6 hours ago, ComfortablyNumb said:

There are some insurance companies (e.g. NRMA, Youi, but not Budget Direct) where the premium will not increase with a young driver, but the excess payable if they crash it goes through the roof (e.g. from $500 to $2000+).  Those were the ones we went for when our kids started driving.

I realise I'm in the UK and things are different but on my Building/Contents Insurance, I have an add on that covers me for any excess payment on any policy worldwide. It costs me £40 per year.  That way I can whack the excess right up, pay less for the policy and cover my excess.

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