Insurers undervalue wrecked vehicles, ombudsman claims

[@MARK]

Almost a case of tell us something we don't know

BBC News - Insurers undervalue wrecked vehicles, ombudsman claims

Complaints to an ombudsman about motor insurance rose by 29% last year - with key gripes including valuations of written-off vehicles.

There were 7,238 inquiries to the Financial Ombudsman Service in 2011.

The ombudsman has accused some insurance companies of valuing by trade price - the amount a dealer would pay - rather than retail price.

But an insurance trade body said it was a volatile market, and some owners overestimated what their car was worth.

 

[grober]

Its high time that car insurance policies should be actually based on an " nominal agreed market value" for each renewal. At present owners are only asked to submit an estimated value of their vehicle when starting the policy. This becomes meaningless several years of ownership down the line as the market value of the vehicle falls. Interestingly although only part of the cost of car insurance the substantial lowering in cost of replacing the vehicle to the insurance company never seems to reduce the premium as the car ages despite the potential "payout reduction"

 

[mjrennie]

Its high time that car insurance policies should be actually based on an " nominal agreed market value" for each renewal. At present owners are only asked to submit an estimated value of their vehicle when starting the policy. This becomes meaningless several years of ownership down the line as the market value of the vehicle falls. Interestingly although only part of the cost of car insurance the substantial lowering in cost of replacing the vehicle to the insurance company never seems to reduce the premium as the car ages despite the potential "payout reduction"

I totally agree. There's almost something scammish about insurance. I'm going to take a Return To Invoice poliocy on top of my fully comprehensive insurance. OK, it's about £200 and covers 4 years, but if my policy with LV is fully comprehensive as the name suggests, I wouldn't need to do anything else. Meh.

Not to detract form the OP, but does anyone have a view on RTI insurance, GAP as it is better known? There are various forms at competitive Internet prices. Dealers prices have been exposed as proposterous.

 

[@MARK]

I'm going to take a Return To Invoice poliocy on top of my fully comprehensive insurance. OK, it's about £200 and covers 4 years,

I hadn't realised just how cheap this stuff was.

On mine with an invoice of £40k even with £25k cover for 4 years it's still only £250

You would almost want your car to be written off in Year 3

But

I have never heard of any of these companies offering this so question the trustworthyness