Is such unscrupulous action truly warranted?
Is such unscrupulous action truly warranted?
A client had his Volkswagen parked in a private road outside his own home. A third party rammed his vehicle as she attempted to park her own vehicle. There are no problems about the way the third party and her insurers have acted subsequently.
The problem arose after the client's vehicle was repaired because, in accordance with his motor insurance policy, he had his vehicle repaired by the insurer's own authorised repairer. Subsequently the garage, where the client has always had his car serviced, told him that the bodywork warranty, in respect of the repairs carried out to his vehicle, has probably been voided for the
balance of the manufacturer's ten year bodywork warranty.
The insurer has acted in the best interests of all concerned, both to keep costs down and to ensure that the highest qualities are maintained according to industry standards by having an authorised repairer scheme. It would seem that, even when the repairs are carried out to, or above the standard Volks-wagen maintain for its own network of authorised garages, it can still attempt to void a contract which, on the face of matters, is apparently against both competition rules and the rights of the consumer to choose for themselves who will work on their property.
I understand that this restricted covenant practised by Volkswagen is a reappearance of a similar one it used a number of years ago. It was challenged by insurers and others, and changed its contract wording.
This time the garage, which is Volks-wagen's main dealer/servicing agent, is saying that it cannot be sure that repairs were carried out to the standard required and, because the work is done by someone outside the manufacturer's control, why should Volkswagen be required to continue its guarantee?
There are serious potential problems here which are not of the insured's making but which place the insured in an apparently impossible position. Should the insured use a garage of his choice, where he does not automatically have use of a courtesy car for the duration of his own vehicle being out of commission, or does he use the insurer's authorised repairer with all the extras provided in his policy? Also, should he have his own vehicle repaired more quickly without the need for costly and unnecessary paperwork, does he lose his warranty as a result?
Having used the insurer's authorised repairer and been given a 24-month guarantee of the work done, what does he do about the balance of four to six years left on the manufacturer's own warranty?
I understand that at least two Association of British Insurers (ABI) member companies are building up a file on this problem. My question is whether more people should be caught out by this problem or should insurers now apply to the Office of Fair Trading to have this type of vehicle warranty outlawed?
While insurers make up their minds, I suggest that everyone in our business should check for warranty problems each time an accident occurs and to ensure that the client receives the appropriate advice, especially when dealing with Volkswagen owners.
--
Terry Rechnitz
RP Hodson (London)
What a fiasco
I wait with baited breath to see a response from the General Insurance Standards Council (GISC) on the very issue raised in ‘Letter of the Week', Insurance Times September 21.
In a similar vein I wonder if fellow readers are aware of the current state of play at the Insurance Ombudsman where – inevitably – disgruntled Tesco travel insurance policyholders may well seek recourse.
Unfortunately I have had reason this year to make a claim (coincidentally) on a travel insurance policy. Briefly, my insurer and I do not agree on the amount it has paid and we have ended up at the ombudsman.
I sent my claim form to the Insurance Ombudsman Bureau (IOB) on June 14 and chased it up on July 26 to be told that the earliest I could expect to hear would be a minimum of three months after they received my claim. Not having heard from the IOB as of September 25 I telephoned the bureau and you will be pleased to hear that it has now responded to my complaint (not to my satisfaction I may add) having received a letter from it yesterday.
On patiently asking why it takes so long, I was told that apparently the IOB has never been so busy, with the number of complaints it has to deal with increasing by the day.
My concern is that where the IOB finds in favour of the policyholder, a delay of three months or more hardly allows sufficient time for the responsible insurer to take corrective action to prevent a re-occurrence of the same problem in the future. A similar claim going wrong could clogg up the system even more. Surely this situation is unacceptable and I wonder what is being done at the IOB to help matters.
--
Peter Lawton
Langley & Horrocks
Castle Bromwich
Birmingham
No breach of protocol
I refer to the interesting article by Weightmans in legal focus September 14 in relation to the increase in costs which will result from conditional fee agreements (CFAs).
While I can understand the concerns on the parts of insurers in this regard, one of the suggestions for curbing such rising costs is what is described in the article as “fixed or benchmark costs”.
I would hope that many of your readers in the insurance world will already be participants in the RTA Protocol Pilot scheme. Since May 1998 it has provided a fixed matrix of costs for general damages in cases other than fast-track claims which is settled prior to commencement of proceedings.
As far as I am aware, both insurer and participants alike have perceived benefits from such a scale, along with many other benefits of the RTA Protocol system generally.
This scheme has been monitored by the Lord Chancellor's Department and it is hoped that before long it will be embodied into an obligatory protocol in the same manner as the personal injury protocol. However, those insurers that do not as yet participate in the scheme could well benefit from joining it in its voluntary state, as it would then apply to all road traffic accidents involving more than 30 firms of solicitor participants.
Details of the scheme can be obtained from MASS at 54 Baldwin Street, Bristol BS1 1QW.
--
Chris Lodge
Accident department partner
Andrew Gardner Partnership
Maidstone, Kent
Oh the irony
Re: What did the Romans ever do for you? (news p14, Insurance Times, October 5).
An interesting question deserving of an answer. Roman emperors when they gave up their thrones did not make miraculous comebacks. Indeed, the penalty for failure was so severe a comeback proved to be beyond even the adept.
Certainly balancing the books was an important priority.
Your article heading of course is taken from Monty Python. Possibly, therefore, the article is meant to be of a humorous nature in which event I apologise for missing the punchline.
Any broker wishing to speak with a legal expenses management with a long and sound history of not falling on its sword or needing to return dead parrots may like to talk to DAS.
--
C Wright
DAS, Bristol
Easy does it, please
Mr McLaclan's reply was disgustingly rude and warrants a reply (letters October 5).
We at the sharp end of insurance have noticed that since the implementation of Polaris standards by our software house, the question sets we go through for a quote are far more onerous. It may be that this is due to the insurers and the software houses and if so, I appeal to them to look again at unneccessary details that prolong quotations.
I have spoken to an insurer friend who wonders which insurer uses the Polaris software for only six questions. Perhaps McLaclan can name the insurer. I understand that if Polaris software is used to ask only three questions, then quote systems will not work.
I merely appeal to those involved in delivering the product to the market, to make things as easy as possible for us, not harder.
--
John Gray
Managing director
GTI
Admirable policy
We were very interested to read the article concerning Admiral's website elephant.co.uk and its heavy investment in marketing and staff resources – particularly in light of a letter sent to us by a new client.
Our client had contacted Admiral for a quote on his BMW. He is in his early 40s and has a full no claims discount – not a great risk for any insurer. He was therefore staggered to receive the quote attached, detailing a premium of £7,693. Needless to say, we have found him a far more reasonable premium and he won't be contacting Admiral again...
We now wonder whether the final paragraph on their quote sheet was intended to be ironic: “(the quotation) only takes a few minutes and we could save you £££s”.
--
Henrietta Smart
The Davis Group
Newmarket , Suffolk
