As a result of the well documented case of Dimond v, Lovell and the recent ABI initiative on replacement vehicles credit hire companies are facing a very different legal and insurance environment.
Undoubtedly, despite the best efforts of some insurers, credit hirers will continue to play a vital role in supporting the victims of non-fault accidents.
It should not be forgotten that non-fault accident assistance only came into being in the early 1980s because of the frustration of accident victims regarding the lack of support given to them by insurers. Individuals, who were looking for a replacement car, funding of repairs, the representation and administration of their claim, were left with no one to defend their corner.
There is definitely a clear distinction between how the credit hire industry and insurers view non-fault drivers. To the former that person is a victim who needs to be supported, whereas the third party insurer faces a definite conflict of interest between helping that individual and reducing their own claims costs. This conflict casts a shadow over the recent ABI initiative that will ultimately result in its downfall.
In many ways, the industry has become the victim of its own success at pursuing claims for legitimate financial redress. As third party insurers found themselves having to pay out increasing levels of compensation to those caught up in non-fault accidents they looked at ways to restrict our operations and their losses.
Recent actions by insurers, particularly, with regard to the interpretation of the 1974 Consumer Credit Act have presented our industry with a number of obstacles. Regulation of the credit hire industry through the application of the Act is to be welcomed. However, the technical challenges by insurers on subsequent agreements represent the blatant use of the Consumer Credit Act – designed to assist consumers – as a weapon against the consumer's best interests.
We are determined that such tactics will not reduce our efforts to meet the needs of non-fault victims. If this means continuing to take on insurers in the courts to achieve settlement of claims, then that is something we are willing to undertake.
Pressure is also being brought to bear on brokers and approved repairers (bodyshops) to follow the insurers' lead and avoid dealings with credit hirers. This action, verging on a restrictive practice, is compromising relationships built by credit hirers with intermediaries and is a blatant misuse of power against consumer's interests.
Certainly, there is a great deal of misinformation around about credit hire. The belief that we are ambulance chasers or responsible for inflated claims is far removed from the reality of the service which reputable concerns provide. Unfortunately, this has not prevented such opinions being voiced in wide ranging attacks.
As an industry, we are determined to address any concerns there may be about the practices of a small minority of operators who behave in a less than professional manner. In my role as a BAFACH (British Association for Accident Car Hire) committee member, I will be working to establish a comprehensive self-regulatory framework. It is in all our interests to highlight good practice and tackle those who fail to uphold standards.
In the end drivers involved in a no-fault accident should be given a choice. Do they want their claim for legitimate financial redress handled by a company acting on behalf of the person who caused their accident, or a company representing their interests? The results of a national survey would, I'm sure, prove very interesting!
The consumer demands it, and as long as that remains, the non-fault accident assistance industry is here to stay.