Car Insurance Claim Refusal To Pay Out

[DancingDoris]

A few months ago, my mother took my sister to a party in my sisters car, drove it home, parked it on the drive and locked it as you do. She was woken at 4am by police to inform her that the car had been stolen from her drive and found written off less than a mile away. They had been to my sisters house (the registered keeper / owner and only insured on the vehicle) but she was pretty drunk and hadn't been able to give them any answers.
Anyway, now the insurance are refusing to pay out as they say my mother was in charge of the car and was only covered third party by her own insurance. They are saying this as my mum was the last person to drive the car. Surely though, if my sister had driven the car to my mum's and then caught the bus where she was going, presuming the car was still stolen, they would not be able to use this supposed "clause" to get out of paying as my sister would have been the last person to drive the car?
Could anyone help? Is there anyway that the insurers would reconsider? Are there previous cases setting precident in this case? She cannot afford to replace the car. Any help at all would be greatfully received.

Thanks in advance.

[factor-fiction]

his thread shows that many people don't understand the implications of letting someone drive their car if that person isn't listed as a driver on the owner's policy.

But I would be interested in the outcome of this case. I wonder if the insurance company would have simply paid the claim if your sister had not mentioned that your mum had driven the car last and had simply said she'd left it her mum's overnight as a one-off.

[New Judge]

Yes, factor, I think they probably would have.

The strange thing about many insurance matters like this is that policyholders are often penalised for telling the truth even though there is no significant difference to the risk that the insurers cover. As has been said, if DancingDoris’s sister had simply said she drove to her mothers, left the car there and went out there would have been no problem and I doubt the insurers would have looked twice at the claim. By stating precisely what happened, even though it made no appreciable difference to whether the car would have been stolen or not, the insurers repudiate the claim. And insurers wonder why their policyholders tell them porkies from time to time.

I understand them denying liability in instances where the risk is greater (if, for example, she said the car was normally garaged at night but it was always kept on the highway). But in this case the person who last drove it and (nominally) has it in their “custody and control” does not alter the risk.

I would be interested in the outcome, but I fear the insurers will stick to the “small print” in their policy and the arbitrators will have no choice but to rule in their favour.

[CanisMajor]

HYmie, when using the "drive any car with the owners permission....." clause, the cover is third party only, not TPFT.

[New Judge]

Quite, Canis. But the car was not being driven. It was parked.

I’m very interested in this question. One of the issues that springs to my mind is just how long does the nullification of Fire and Theft cover last? Supposing the car was parked up by a driver not covered by the policy at the insured’s address and it remained there for, say, six months? Are the insurers saying that it remains uncovered for all of this period because the last person to drive it was not their policyholder? Their risk is not altered by the fact that their insured was not the last person to drive the car. I think in those circumstances if the car was stolen after, say, six months, they may struggle to repudiate the claim.

I’m playing devil’s advocate here because I can see both sides of the argument.

[Hymie]

Taking this argument to its logical conclusion – should I lend my mum my car (for which I have fully comprehensive insurance), since she would only be covered third party (by her own insurance) – if the car was stolen, my insurance would refuse to pay out.

Therefore same argument (for refusal to pay out) must apply whether the primary insurer has fully comp. or TPF&T cover.

[New Judge]

Whether the primary policyholder has comprehensive or TP, F&T is not the issue here, Hymie. It is the Theft element of cover (which is provided under both types of policy) which is being denied by the insurers.

I can understand the insurers repudiating liability if you lend your Mum your car and it is stolen whilst she is, say, out shopping in it. However, what happens if she returns the car to you, parks it outside your house and you do not use it for a few days (or weeks or months). Your insurers will say it is not covered for theft because your Mum was the last person to drive it. My contention is that the risk that the insurers are covering is not altered by the fact that she was the last person to drive it. She cannot possibly still be “in charge” or have custody or control of the car and the fact that she was the last person to drive it is largely irrelevant.

The situation described by DancingDoris is clearly somewhere between the two extremes I have outlined and that is why I am interested in the outcome.

[Hymie]

I would be somewhat miffed if my insurer did not pay out (on my comprehensive insurance policy) should my car be stolen – regardless as to who drove it last. Of course, should they have been careless and left the keys in the ignition, then that would be another matter.

Insurers are always citing their terms and conditions as an excuse not to pay. I recall a few years ago they were refusing to pay out because owners had modified their cars (without informing the insurer of the modification – as per the terms of the insurance). The ombudsman ruled that the insurers must pay out on the claims. The modification in question was the fitting of a roof-rack to the vehicle.

[factor-fiction]

I can see both sides here. Perhaps the insurer's view is that the risk of theft does increase in these cases- they may feel someone borrowing your car in this way may be less likely to take proper care over its security - and therefore they don't cover theft.
On this basis you should never lend your car to someone if they are not covered for theft on your policy because presumably the insurer wouldn't pay if it was stolen from anywhere- supermarket, work, drive, roadside, etc.

[hc4361]

Maybe the insurance policy states the 'any other driver' aspect is for emergency only.
This is Direct Line's policy and is becoming more common in the industry.
'This cover is limited to Third Party Only and should be viewed as emergency cover only.'

http://faqs.directlin...surance/drive-any-car

[New Judge]

Yes factor, that's a good point. But how long does the "additional risk" last? (See my recent post). Surely not until the policyholder drives it again.

[hc4361]

Is it a simple case of 'who has the keys'?

[Hymie]

I have two sets of keys to my car.........

[kloofnek]

The car was stolen...what difference does it make as to who parked it or where!!!!
It could have been took whilst in the supermarket car park,..whilst having a coffee in a teashop...anytime in fact.....if it was insured for theft...they should pay up!!!!

By the way,DDoris...who is it insured with?

Hope you put up a real fight,don`t let them fob you off with their legal jargon!!!!