Privilege Insurance has agreed to pay the victim of an elaborate motor swindle, in a sudden reversal of its decision two weeks ago.

The Insurance Times' front page on March 15 featured Jason Wells as the innocent dupe of a ringing scam that had fooled police and insurers for at least three years.

Privilege had demanded Wells' £750 up front before it considered his claim, deliberated for six months then turned down his claim, although Wells had done an HPI check before closing the car deal.

At the time, HPI said that Wells might be covered under its guarantee, which protects innocent purchasers of stolen vehicles.

HPI instructed Claims Management & Adjusting's Philip Swift, who convinced Privilege to pay the claim.

“Our reasoning was accepted and Privilege made a prompt decision to settle the loss at £7,500, with a £500 ex gratia payment to Mr Wells for his inconvenience,” Swift said.

A Privilege spokeswoman said the complexity and scale of the fraud had clouded the issue. She did not say whether recent publicity had any bearing on the latest decision.