Company car insurance - paying for damage to

[JohnW]

Apologies if not the appropriate forum, but perhaps quite an unusual query. Basically, have worked for a prestigious car dealership for last 3 years and have enjoyed the benefits of a company car (for which I obviously pay company car tax!!) As a salesperson using a dealership company car, it is naturally insured by the dealership fully comprehensively.

Due to an increase in accidents and claims during 2007-8, the insurance company have increased their excess to a whopping £10,000 (so I am informed?) The net result is that any damage caused by whatever means (i.e. vandalism (whilst sleeping!!) i.e. sides of the car 'keyed' or impact damage is to be paid for by the individual, not the company, as the dealership tells us that understandably they will not pursue any damage through insurance due to the £10,000 excess!!

I have had a clean driving record for last 3 years and then, this morning, on approaching a t-junction (bus parked in front of me waiting to turn), and at speed of seriously no more than 10-15mph (due to ice on road), I applied the brakes only to find NO traction at all!!!!! It was literally like skating on ice and the car gracefully slid, albeit slowly into the back of the parked bus. (Driver told me he was driving this road since 6am and it was the WORST he had encountered). Lady driver behind me actually slid ACROSS the road into a lampost not 10 minutes later.

Am awaiting the estimate for repair, but my GM has already spoken with me and told me that in all likelihood I will have to pay for the damage. Likely to be in region of £1,000 to £1,5000. Would not accept my mitigation. In fact, my colleague had to repay £1,000 last month for his company car being 'keyed' whilst he was in his house fast asleep.

It worries all our staff as accidents do happen, and I am not allowed to either (a) take out any form of insurance to cover myself as I have already looked into this, and (b) although a company car is deemed to be a 'perk', it is inevitable that at some stage more accidents or damage will occur and each time it will be deducted from our salaries. We have no say in this matter and has already happened on two occasions to my colleagues last month.

Does anyone have any knowledge as to the legitimacy of this procedure? Is there an insurance that will cover a salesperson who changes demonstrator cars every 3-6 months for this type of incident? Any help or advice will be greatly appreciated. By the way, please dont get me wrong, if any driver is acting recklessly etc - then this is perhaps understandable as a company stance. But at slow speed, and braking not being effective on icy road.

[reallymadwoman]

This sounds entirely unfair. Either they insure the vehicle for you or you should be able to insure it yourself. Are they going to charge you for a replacement vehicle if it gets completely written off through no fault of yours - e.g. if it was hit whilst parked?

 

Having said that, I don't suppose this is a situation which comes up very often, so though I would like to direct you somewhere for professional advice, I have no idea where.

[patdavies]

I'm afraid that if my company attempted to impose that condition on me (£10,000 excess) I would simply hand the car back and state that I was refusing to accept such a blatantly unfair term.

 

At the very least, I would withdraw, in writing, any ability under their car scheme to make any deduction from wages.

[Lula]

I would also go and get a competitors car and drive that around, it would annoy them no end, seriously though, it seems dreadfully unfair, I too, would hand the keys back.

 

What does your employment contract say?

[Mossycat]

Sadly there is little you can do in this instance.

 

Big excesses are normal in the environment you work in, £10,000 is quite a common one. There are insurers who offer insurance policies for this type of excess, they work like the CDW's you get offered when you hire a car.

 

In this instance there are no mitigating circumstances, the road was icy, you failed to appreciate that and drove without due care and attention, the result was you had an accident. Accordingly, your employers will now look to you for the cost of repairs.

 

You asked if this was legitimate, presumably you were aware of this large excess before the accident and you accepted it. It is legitimate, it's not unfair and it's fairly standard in your industry.

 

As others have pointed out if you don't like it you can always give up the Company Car and use the savings in tax to fund your own vehicle, or you can seek out an insurance policy to cover the big excess.

 

Mossy

[patdavies]

Big excesses are normal in the environment you work in, £10,000 is quite a common one. There are insurers who offer insurance policies for this type of excess, they work like the CDW's you get offered when you hire a car.

 

This would appear to provide an answer - supplementary insurance cover.

 

However, OP posted

 

It worries all our staff as accidents do happen, and I am not allowed to either (a) take out any form of insurance to cover myself as I have already looked into this,

[Mossycat]

Yes Pat I saw what the OP posted, but, there is nothing whatsoever to stop the OP from taking out their own seperate insurance policy to cover the excess, and to some extent these policies are easier to arrange because it is for a known fixed sum, ie a maximum of £10,000.

 

The OP needs to clarify why they feel they are not allowed to do this, I have never heard of an employer saying to employees that they do not allow them to arrange this type of cover (usually they welcome it since in the event of a big claim they know that the excess payment will be swift, I know I would struggle to instantly come up with £10,000), and certainly there is nothing in law to stop the OP arranging this type of cover.

 

Mossy

[JohnW]

Thank you all for your advise and comments. I am still awaiting any final decision on the deduction, i.e. all of part of it to be paid by myself.

 

Big excesses are normal in the environment you work in, £10,000 is quite a common one. There are insurers who offer insurance policies for this type of excess, they work like the CDW's you get offered when you hire a car.

 

A year ago I phoned many of the large insurance companies because I was aware that accidents can happen and was concerned about this. But I was informed that no policy existed (similar to CDW) as we change our cars every 3 months or so and also can be in a different car every week; it had to be particular to a registration - so was unable to cover myself.

 

Yes, I am seriously considering opting out of the Company car scheme which is undoubtedly the route to go (for peace of mind).

 

Again, thank you all for your comments and helpful advice.

[Mossycat]

There is a company called Insurance4excess (or something very close to that) who offer an annual policy to cover a CDW. It's aimed at people who hire cars on a regular basis, but I mention them because they obviously allow for changes of vehicle (ie diiferent hire cars) in an annual period.

 

To be honest the registration number is irrelevent in your case, you are NOT insuraing a particular car, you are insuring a known risk, ie the amount of the excess.

 

I suspect you probably went to an Insurer who doesn't usually offer this policy and hit the stumbling block about registration number because their system needs one to proceed to quote.

 

Mossy