Coyote:

s_whitie:

"it wouldn't be fair to assume that every person paying a higher price for a vehicle should be aware that their vehicle could be modified. Such a suggestion is a little absurd. "

re your comments, why would the vehicle be at a higher price. Surely you would question this when you buy the vehicle otherwise you would go for the cheaper of the two vehicles? At the end of the day you are paying for the vehicle and having to insure it, make sure you know what you are buying (buyer beware)

I agree it is not common for insurers to pursue a policyholder to refund a TP claim but that is each and every insurers option to pursue if they wish.

To be honest I have dealt with quite a lot of cases like this and have always said, if the vehicle is modified and the policyholder is innocent of misrepresentation then we deal with the claim on the basis the premium is adjusted to reflect the insured vehicle's Correct specification.

I understand people will say that it is not the policyholders fault that he did not know what the vehicle was but why should the insurer pay for their mistake. They are only pricing the policy on the information given to them so if that information is wrong then as far as I am concerned why shouldn't the insurer adjust the premium before dealing with the claim?

"re your comments, why would the vehicle be at a higher price. Surely you would question this when you buy the vehicle otherwise you would go for the cheaper of the two vehicles?" Are you being serious? Some people will only go to look at one car and buy it at the asking price, some will haggle, some will look at 30 cars before making a decision. It may not be on price that the vehicle is chosen, it could be a number of factors. My point was that the insurer cannot repudiate a claim stating "you could have got 'X Car' for £100 cheaper 3.5 miles down the road. You MUST have been aware this was modified. We're not paying out". I'm sure you appreciate the point that's being made. Yes, if the information is wrong then the insurer shouldn't pay for a mistake. The problem is who's mistake? It's not the insurer's because they were not informed by the insured, the insured may not have known about it, etc. The chain is far too long and there is no 'negligence' as such as it's not a requirement to let the buyer beware and, again, it would be unreasonable for a person without knowledge of cars to know such information. They should pay the premium for that modification/modifications as if it were before policy inception; or taken out of the claim payout. The problem comes when that insurer would not cover the modification in the first place; they may need to make an unusual exception in this circumstance and compromise with the insured.

My point was that the insurer cannot repudiate a claim stating "you could have got 'X Car' for £100 cheaper 3.5 miles down the road. You MUST have been aware this was modified. We're not paying out".- No I never said that

I said - To be honest I have dealt with quite a lot of cases like this and have always said, if the vehicle is modified and the policyholder is innocent of misrepresentation then we deal with the claim on the basis the premium is adjusted to reflect the insured vehicle's Correct specification.

They should pay the premium for that modification/modifications as if it were before policy inception; or taken out of the claim payout. The problem comes when that insurer would not cover the modification in the first place; they may need to take an unusual exception in this circumstance and compromise with the insured.

I previously said -

They then have 4 options:

1. the misrepresentation was deliberate to obtain a cheaper premium. This could lead to them cancelling your insurance and declining the claim.

2. the misrepresentaion was not deliberate but had they know the facts they would not of insured the car. Again the claim will be declined.

3. As 2 but the would of insured the vehicle at a higher premium. In this case they will deduct the increase in premium from the value of the vehicle.

4. no further action is required.

If you read all of the above then I think you will see that we are both saying the same thing. My point is that as a fraud manager I know that I can write to the previous keeper and asked them for a history of the vehicle. If they tell me that the vehicle was modified then why can't the policyholder ask the same question when buying the vehicle. You will be surprised with the number of times we have asked the previous keeper and they tell us they told the policyholder but they have then failed to disclose this to the insurer.

One point is that the majority of these cases are blatent modifications ie spoilers, engine size increases, body kits being added etc. Now don't tell me that you look at a car like this and think "ahh thats nice, that must be just how they roll of the production line!"