Car insurance claim void.

[JonCris]

Whatever you do DO NOT Return the certificate. The reasons are technical but suffice to say it could effect your claim.

 

Crafty so & so's. In view of this Do NOT trust them get everything in writing from now on or if you must phone record the conversation

[bed32]

Whatever you do DO NOT Return the certificate. The reasons are technical but suffice to say it could effect your claim.

 

Crafty so & so's. In view of this Do NOT trust them get everything in writing from now on or if you must phone record the conversation

Could you give some details about what the issues may be?

 

I'm interested in that my ins co tried this one on me and I'm wondering why they did so

[patian47]

The issue raised on my husbands fully comp policy WAS REG KEEPER NOT POLICY HOLDER. The broker had on the policy notes that I was the reg keeper (MRS). Infact our son is REG KEEPER. So when we sent all the documents in for a total loss of car claim due to RTA, they refused our claim, saying we had failed to give material fact. Since then we have requested CIS to reveiw this judgement, after advice from legal team that this is a technical issue and would not have effected or caused fraud. So we are waiting for another 4 weeks, then will take it up with the FSO if they don not offer a agreement. This policy was changed by me mid term, and I was the previous reg keeper on that car, but I removed myself from the policy details and changed the car details, this is where the confusion lies in the way as I dont remember what was asked at the change over by broker it was a year ago?There does seem to be utter confusion on what OWNER and KEEPER refer to as they are two different things, but the broker simply asks owner/ keeper all in one question. I hope this clarifys my situation, but please ask if you want to know anything else, the forum site has given me some very helpful advice.

[stuthesaint]

I believe that I can clarify this matter for you.

There are many issues here which may be addressed, but the most salient comes down not so much to that of insurable interest, but of the maxim of the utmost good faith.

This maxim which is applicable to all contracts of insurance effectively means that you must disclose any relevant points to the insurance company, even if you are not asked.

From the insurers point of view, they have been presented with a £10k theft claim and they will effectively do whatever they are legally entitled to do to avoid the claim, in this instance even the policy as a whole (since inception, or change of details).

Most people when taking out a policy of insurance don't fully appreciate the possible consequences of the contract to which they are entering. Everything and anything that may affect the policy of insurance must be disclosed.

Regardless of the vague reasons that the insurers have given you for avoiding the policy, I can assure you that it would have been due to the fact that the finance was in your sons name and hence it is a reasonable assumption that your son is the main user.

In this instance a change was semingly made to the policy to insure a different vehicle. The insurance was to be in your husbands name, but the actual owner/keeper of the vehicle was evidently your son. This is known as fronting, whereby one takes out insurance - typically in a parents name, with a child as a named driver in order to reduce the insurance premium, when in fact the main user of the vehicle is the child. This is attractive as it will reduce the premium payable - and lets be honest, many of us have done this in the past - as it is an easy way to cut the cost of insurance. Your premium will have risen (sometimes significantly) with your son being a named driver, but the insurers will not have fully weighted the premium on your son, as they believed that he was not the owner/keeper/main user and hence only an occasional user of the vehicle.

To cut a very long story short, there is no doubt in my mind that the insurers are perfectly justified in their actions and regrettably your appeal against their decision will not succeed.

I have almost ten years of experience in insurance claims, am professionally qualified and work for the 'fraud' department of a major insurance company and every day many claims are 'chucked out' for the very same reason as yours.

It may be no solace for you, but be grateful that the claim didn't involve another party and typically an injury, as every day I have to phone policyholders and tell them that their claim is void and even for a small accident, the solicitors costs, injury and uninsured loss settlements, credit hire for the third party as well as vehicle repairs can cost many more times than that of your loss. Nowadays it is commonplace for the the credit hire invoice for a third party's replacement vehicle to cost tens of thousands of pounds, even into the hundreds of thousands for a prestige vehicle!!!!

You may have a civil claim against the brokers as they are paid to ask the right questions, but the maxim of utmost good faith still applies and I suspect that you will be unsuccessful in that claim also, however it is shrewd to request a transcript or a tape recording of the discusssions with the brokers regarding the change of vehicle, as it is not unheard of for brokers to sometimes disregard what has been told to them in order to ensure a lower premium (and hence more commission for themselves).

Good luck though and keep us posted as to how to how your appeal progresses

[stuthesaint]

I believe that I can clarify this matter for you.

There are many issues here which may be addressed, but the most salient comes down not so much to that of insurable interest, but of the maxim of the utmost good faith.

This maxim which is applicable to all contracts of insurance effectively means that you must disclose any relevant points to the insurance company, even if you are not asked.

From the insurers point of view, they have been presented with a £10k theft claim and they will effectively do whatever they are legally entitled to do to avoid the claim, in this instance even the policy as a whole (since inception, or change of details).

Most people when taking out a policy of insurance don't fully appreciate the possible consequences of the contract to which they are entering. Everything and anything that may affect the policy of insurance must be disclosed.

Regardless of the vague reasons that the insurers have given you for avoiding the policy, I can assure you that it would have been due to the fact that the finance was in your sons name and hence it is a reasonable assumption that your son is the main user.

In this instance a change was semingly made to the policy to insure a different vehicle. The insurance was to be in your husbands name, but the actual owner/keeper of the vehicle was evidently your son. This is known as fronting, whereby one takes out insurance - typically in a parents name, with a child as a named driver in order to reduce the insurance premium, when in fact the main user of the vehicle is the child. This is attractive as it will reduce the premium payable - and lets be honest, many of us have done this in the past - as it is an easy way to cut the cost of insurance. Your premium will have risen (sometimes significantly) with your son being a named driver, but the insurers will not have fully weighted the premium on your son, as they believed that he was not the owner/keeper/main user and hence only an occasional user of the vehicle.

To cut a very long story short, there is no doubt in my mind that the insurers are perfectly justified in their actions and regrettably your appeal against their decision will not succeed.

I have almost ten years of experience in insurance claims, am professionally qualified and work for the 'fraud' department of a major insurance company and every day many claims are 'chucked out' for the very same reason as yours.

It may be no solace for you, but be grateful that the claim didn't involve another party and typically an injury, as every day I have to phone policyholders and tell them that their claim is void and even for a small accident, the solicitors costs, injury and uninsured loss settlements, credit hire for the third party as well as vehicle repairs can cost many more times than that of your loss. Nowadays it is commonplace for the the credit hire invoice for a third party's replacement vehicle to cost tens of thousands of pounds, even into the hundreds of thousands for a prestige vehicle!!!!

You may have a civil claim against the brokers as they are paid to ask the right questions, but the maxim of utmost good faith still applies and I suspect that you will be unsuccessful in that claim also, however it is shrewd to request a transcript or a tape recording of the discusssions with the brokers regarding the change of vehicle, as it is not unheard of for brokers to sometimes disregard what has been told to them in order to ensure a lower premium (and hence more commission for themselves).

Good luck though and keep us posted as to how to how your appeal progresses

[Trojan1401]

I have to agree here. I very much doubt that any appeal would be upheld even if the "broker" did not ask the correct questions. It is down to duty of disclosure of a material fact - as mentioned earlier in the thread.

[Trojan1401]

Bed32,

 

You mentioned that an Ins co tried it on you, what were the circs ?

[JonCris]

As has been explained repeatedly by the OP they did NOT front for their son insomuch as they did not benefit by a lower premuim for the insurance.

 

In fact by including their son on the cover they will have increased the cost of the insurance to exactly the same level it would have been had the son been the policyholder.

 

The advantages of 'fronting' for a less experienced user are long gone. The level of premuim is based on the LEAST qualified user

[bed32]

Bed32,

 

You mentioned that an Ins co tried it on you, what were the circs ?

It is what ought to be a very simple case of theft where the thieves broke into out house, stole the car keys and drove off in our car - the car was recovered within 12 hours virtually undamaged.

 

As part of their claims procedure the Ins Co asked for some ridiculous things which included returning all the keys and the insurance certificate (not to mention nonsense about VQ5, original receipts, recent photographs of the car...). Basically had I complied (a) I would have been unable to use the car and (b) I would have been hard put to prove I ever owned the car.

 

I politely declined to do this on the grounds I regarded it as unreasonable and having no possible bearing on the claim. What I wonder is why they should do this - I suspect they might have had an underhand motive but don't know what it could be

[patian47]

whilst we are waiting to hear from CIS on our claim. I have searched the iternet for online insurance companies to read what they mean and what assumtions are made. They vary, using CONFUSED . COM, they ask seperatly, WHO IS KEEPER, WHO IS OWNER, therefore you can assume they are two different questions and possibly answers.They then do searches for you on the answers you provided. Then when you go to say NORWICH UNION, there question is WHO IS REGISTERED OWNER, no mention of keeper? it is no wonder why i have had this problem. Out of curiosity I queried Norwich union and asked them to clarify, REGISTERED OWNER, THEY SAY IT MEANS THE NAME ON THE V5 AT DVLA..They did not want to know who paid for the vehicle or where I got it from or who financed it. so good luck to anyone who thinks ,honestly they have insurance. As for STUTHTHESAINT reply, thankyou for your opinion, I have written letters here from both my broker M&S and CIS clearly stating Your policy has been cancelled and claim refused due to POLICY HOLDER NOT KEEPER. And that is . If as you stated it is because our sons has financed it , then that should have been made quite clear in all the correspondence from them, they cannot and I will fight them on this now use that as a further excuse against us. I have taken their correspondence as written. M&s have not sent me transcript or tape recording , how long do you give them, it has been 2 weeks. I requested this by post, and have heard nothing, apart from request for us to send policy document back to them. We have not done so. This has been going on now from march 17th 2007, nearly 3 months. We will use a solicitor if needed. M&S just issue same old letter , we are not liable old crap, really. So, will keep you informed.As for fronting, and they dont like it, make it illegal, which it isnt, just morally whether you do it or not. All our policies have been my husbands, always added the children even, when they were learner drivers, we have never come across this prob untill we HAD a CLAIM.

[stuthesaint]

Hi Patian.

That is exactly what 'fronting' is - having the policy in the name of a lesser risk, when in fact it is meant for the higher risk - i.e. your son.

 

I do not understand what JonChris is trying to say. Of course your son was named on the policy, otherwise we would be looking at a totally different scenario here, but the material facts are that the car was effectively owned by your son (it was his car) and if that was not declared then they would assume that your husband was the main user. A major underwriting criteria is whom is the main user of the car. It is logical, if your son was an occasional user of the car, then of course the premium would increase as a less experienced driver is using the car on occasion and hence the insurer is exposed to a greater risk, however if your son was the main user of the car then that risk proportionately increases - and this info they were seemingly not made aware of in this instance. Whether that is the fault of you, or the broker is a different matter entirely, however as previously advised the maxim of utmost good faith aplies still.

It is incorrect that the premium is calculated solely on the credentials of the least experienced driver. Of course that is an element, but his/her usage is a major contributor too.

Whilst I do not believe that it will help you resolve the situation, you do not say how much no claims bonus (discount) was applied to the policy as a result of your husband being the 'insured', as this is also a major factor in the underwriting decision.

You mentioned confused.com, however this is simply an insurance aggregator, asking a wide range of questions in order to fill out the

boxes on many insurance companies internet forms. All of these insurers may word their questions differently and hence the range of questions asked. Others have crticised my answer, however, whilst mine may be an opinion, it is an extremely educated one - and whilst you may possess documents stating that the claim is avoided due to a non-disclosure of the regd keeper/owner of the vehicle, they all effectively amount to the same thing - that the insurers were not told of who the owner/keeper was (possibly by the brokers) - hence fronting - and that they are well justified in repudiating the claim.

Whether it is fair is a different matter entirely and your best bet is to plead ignorance and complain internally rather than through the FSA, as whilst the insurers may pay for an FSA claim to be investigated - this is not in your, or any other persons best interests, as your collective policies will simply increase as a cumulative effect. As I previously advised, your best bet for success is to pursue the brokers (all telephone calls recorded) and to see if you actually disclosed the fact that your son was paying for the car and would be the main user.

 

Good luck.

[patian47]

Received a letter today from CIS stating that the reveiw is over and that it is NOT CHANGING THEIR DECISION, We have been sent all documentation and letters to FSO sOUTH QUAY lONDON, to see if they can advise us further, I would like to know what is the diference between, FSO and the FSA. My husband no claim bonus on this policy is zero. As we have another policy for another vehicle and use the top allowance awarded on that. So in answer to your query, there are no claims bonus deducted on this policy / claim. We have always added named drivers to our policies, as it benefits us having the availability of a car at all times.We can only put this documentation to FSO , we do not have to play ignorance or hide anything, If it is the case that they neede to see v5 in the same name as policy holder, we could have sent that away ourselves and then they would not have refused claim, but it was just simply never thought of to that as, i changed the policy midway, but never sent away the v5, as oour son resides with us and the vehicle was kept at the same address, it was an oversight really, no more than that, and feel that we are being harshly treated, There are no other legalities involved, and a lawyer has said to pursue it as a settlement should be reached, if not in full partial, on tech issue . We will have to await FOS, and then perhaps try via solicitor.

[bed32]

FSA are the regulator who regulate the industry - they have no role to play in individual disputes between a customer and an Ins Co. FOS are the ombudsman who arbitrates in disputes such as yours. The advantage of FOS is that they can look at general principles rather than having to be bound by the letter of the law.

 

In your case if FOS can't help it would be a waste of time going to a solicitor - technically the Ins Co are within their rights to reject the claim and you would be very unlikely to win the case in court.

[patian47]

Finally after two requests to broker M&S, we received a call back, saying from their pc notes. They have My husband as policy holder and son as named driver, I said that is correct, but what about the keeper question, the agent said, well it doesnt say , it assumes that the policy holder is the reg keeper, i said but anyone can be a keeper?, that is correct he said, but if you want us to locate the call relating to change over details it will take the department at least two months. So that is happening. So I asked, would CIS go from that pc page for the details? yes he said. In that case why did CIS and yourelves state to me in a letter that Mrs (ME) was the keeper. I dont know he said. It just shows on our pc record that (MR) my husband is p/holder and son is a named driver. So I cannot do no more untill they reply with exact details, they will see if I clearly stated that someone else other than my husband was the keeper? or to see if I was asked the appropriate qustion and done in error? Will keep you informed.

[patdavies]

but if you want us to locate the call relating to change over details it will take the department at least two months.

 

No it can't.

 

If you were to request this information as part of a SAR, the law gives them 40 calendar days to comply.

[patian47]

Sorry dont mean to sound a bit dim, but what do you mean NO IT CANT? . thankyou.

[bed32]

No it can't.

 

If you were to request this information as part of a S.A.R - (Subject Access Request), the law gives them 40 calendar days to comply.

They are allowed to decline to provide the information on the basis that it would require an unreasonable amount of effort to produce.

[patian47]

Our other car policy is up for renewal, unfortunately with CIS aswell. We received our quote from the broker, saying, that CIS were unable to renew our policy on this occassion, and the best deal they could find was an incredible £5534.With a co called DISTINCTION. Needless to say I rang the broker to state that we would not be using their quote. Our policy was 842.00 last year. I noticed on the renewal statement, that during the year, I had a slide in feb when we had the snow, that was in the column under my husbands details, then our son had a collision if april, that was also in my husbands column, also 2 claim for glass( one on old car) and one on this car. So it looked as though my husband had done all this himself, I complained to the broker, Why have you put them under my husband? she replied that as he is the policy holder thats what happens, but I said , surely that cant be right, it looks as though he is a bad driver, over 34 years driving and 1 claim, she said Oh I will have to contact CIS and ask them for the details, will ring you back. I also pointed out that when we apply to other companies for quotes, where it says how many claims made, what do i say, she didnt know!. I believe that each individual person who has to make a claim should be clearly stated under their own details, or am I wrong. It look as though my husband has had these accidents himself otherwise. Any advice on this .Plus,didnt think that glass was counted as a claim, considering we paid extra to protect our 65% bonus, are they taking the PEE with their so quote. I asked Nowhich union for exact same quote, and stated 1 window claim for husband, 1 window and a collision for our son. Im not fussed about driving. It was 1200 approx. But if they take the claims made in the policy holders name, then do I have to state all the claims in my husbands name as it reads on the renewal statement or break it up to individual driver as claim.I think that CIS are gradually driving me insane.

[xrchris]

Whether they count or not some insurers note glass claims on the policy. I am assuming that only 1 claim is logged as a fault claim whereas the other is just noted as a loss, no claim as they avoided cover under the policy. This also means that you will have to disclose this declinature to other insurers when seeking cover until such a time as you manage to rectify the claim avoidance to your favour.

[StormWarrior]

This situation is going to change soon, legislation has been passed, that appeares to basically, make the 'owner' have an insurance policy for the vehicle.

 

Road safety Act 2006 (Section 22 in this case) has received Royal Assent. That does not mean that it is now in force, or that all of it will ever be activated. The government will bring it in a piece at a time.

but you can bet this will be one bit that gets activated

[patdavies]

This situation is going to change soon, legislation has been passed, that appeares to basically, make the 'owner' have an insurance policy for the vehicle.

 

Road safety Act 2006 (Section 22 in this case) has received Royal Assent. That does not mean that it is now in force, or that all of it will ever be activated. The government will bring it in a piece at a time.

but you can bet this will be one bit that gets activated

 

I still don't see how this can work. In the UK we primarily insure the driver. I am not even sure it is possible to insure a vehicle if you can't drive. There is no legislation that compels a registered keeper to hold a driving licence (or for that matter even be old enough to drive).

[Pliny the Penuriosus]

Agreed pat more failed to 'join the spots thinking' from our wonderful legislators.

 

What if an owner is disabled & has never held a licence but has a car in which a family member conveys them.

 

Are they goiing to set the premuim on the basis of the non-driving invalid or the non-owning driver.

 

Now let me guess which will produce the higher premuim??

[GIclaimsman]

You are all almost there on this occasion the insurance company are worried about the father fronting the policy for the son (to avoid paying for the least experience driver as the main user) which is technically underwriting fraud. If at the inception of the policy it was advised the father was the owner and registered keeper and that is not the case then the rest of the applications is tainted and material to the legal contract and the premium

[patian47]

I changed the policy midway, removed myself and changed car details (MRS). However the broker has on their records that I am the keeper/owner and CIS have confirmed that. But im not on the policy to drive, so how can that be. My husband has always been main driver and myself and sons named. But then CIS wrote and stated that claim was refused on, POLICY HOLDER NOT REG KEEPER. Infact the v5 is in our sons name, we didnt even think this mattered due to all being on policy and live at same address. Anyhow, they reveiwed and still said no, we have just submitted the paperwork to FOS. It does state on the v5 not proof of ownership. Our son got the car on finance(to assist us), we agreed to pay the monthly cost and upkeep, in return our son had use of the vehicle, when we did not require use.When we received the v5 it had our sons name on it. The car finance only stated that we should have fully comp cover, and we were led to believe anyone can be a keeper. I asked Broker for trancsript of when i changed details, they said it could take them 8 weeks.If i did not answer the correct questions on this midway policy then it was a misunderstanding of what they wanted as owner and keeper are two different things?

[hachette]

Is there any more update on this case. My friend is going through alomost the same case and she is suing the insurance co so I would be grateful to know what news are with this case.