Introduction to the statement
A road traffic accident (known as an RTA) is an unpleasant and very often an emotional experience. As a general guide, a driver is involved in an RTA once every seven years.
First thoughts and actions in the event of an accident must always be to check for injuries, and if there are injured people, to call the emergency services so that they are on the scene as soon as possible to care for the injured.
But once these actions have been taken, or the accident is thankfully injury-free but you are left with a damaged vehicle, what should you do? What are your rights and responsibilities following an accident? Should you admit liability? Who should you contact? And what are the expectations you should place on service providers, be they an insurer or a claims management company?
In its recent 2014 report* investigating the motor insurance market in the UK, the Competition and Markets Authority (CMA), said that customers were generally wholly unaware of their rights and responsibilities following an RTA. In response to the CMA’s report, the Credit Hire Association, the trade body for the UK's credit hire industry, has worked alongside legal experts, insurers and others to produce a statement of rights to help customers navigate their way through what seems a complex process, from accident through to settlement of the claim.
We hope all those who use Britain’s roads will find this document useful. The CHO is committed to improving the information we give to Britain’s drivers and we welcome any feedback from customers on the statement.
* Competition and Markets Authority, Private Motor Insurance Market Investigation, October 2014
Statement of consumer rights following a road traffic accident
This statement is to help you understand: (a) your rights following an accident; and
(b) the different ways in which your motor insurance claim can be handled.
- This statement focuses on your rights in relation to repairs and a temporary replacement vehicle. For further information on these rights or your rights in relation to any other losses you have incurred, or if you or your passenger(s) have been injured, you may wish to seek independent legal advice.
Your rights following an accident
- You can choose to make a claim under your own motor insurance policy or to use the services of a claims management company or solicitor to pursue a claim against another driver.
- Those representing you and the insurer of any other drivers involved in the accident will investigate the accident circumstances and, with your input, will assess who they consider is responsible for the accident. You should make no admission of liability before that process has been properly concluded because it may affect your no claims discount in future years and require you to pay an excess on your own insurance policy which may not be recoverable from the insurer of the other driver.
Claiming against your insurance policy
- Any claim you make against your own insurance policies may require you to pay an excess and may affect your future premium and no claims bonus years and discount. Some insurers may waive any excess if you are not at fault for an accident and you may be protected against any loss of no claims bonus years if you have taken out no claims bonus protection.
Your rights if an accident is your fault
- If an accident is your fault, your contractual rights are set out in your policy documentation. For further information, please contact your insurance provider. In law you are responsible for losses you have caused others and your insurance will cover these.
Your rights if an accident is another driver’s fault
- If an accident is another driver’s fault, it is the responsibility of the other driver under law to put you back into the position you would have been in had the accident not occurred. Any cost that you could reasonably avoid may not be recoverable from the at-fault driver.
- Your rights against the at-fault driver include compensation for:
- The damage to your vehicle:
- You can choose to have your vehicle repaired by a repairer of your choice, by a repairer recommended by your insurer or by a repairer recommended by the company handling your claim. If you choose not to use a repairer recommended by your insurer, you should check whether that has an impact on your excess or no claims bonus. The repairer should return your vehicle to the reasonable condition it was in before the accident occurred. If you do not have comprehensive motor insurance and you agree to the repair being undertaken on credit, you maybe responsible for the costs of the repair if they cannot be recovered from the at-fault driver although you will generally be provided with a separate insurance policy by the company handling your claim that will protect you against this eventuality (subject to specific exclusions).
- If your vehicle has been assessed as being uneconomic to repair and is a write-off, you are entitled to the market value of an equivalent vehicle of a similar age and condition at the time of the accident. This is usually based on publicly available information.
- A temporary replacement vehicle:
- If you need a temporary replacement vehicle for the period you are without your vehicle, you are entitled to one that is equivalent to your vehicle (for example, similar in size, type, number of doors and engine capacity) and on the same terms on which you are permitted to drive your own vehicle but with a zero excess in respect of theft and collision damage charges.
- You may be provided with a temporary replacement vehicle by your insurer as part of your motor insurance policy (often referred to as a courtesy car) that may not be equivalent to your own. If this is not suitable for your needs your insurer may refer you to a replacement vehicle provider who will provide you with a vehicle equivalent to your own, possibly on credit terms (often referred to as credit hire).
- You may also be offered a temporary replacement vehicle or courtesy car by the at- fault driver’s insurer. This is often arranged through the larger national rental companies. If this is not equivalent to your vehicle you are entitled to ask for one that is.
- Before you take delivery of a courtesy car you should ensure that the at-fault insurer who made the offer has confirmed in writing that they have agreed to pay for all of the hire charges.
- If you are offered a car under a credit hire agreement then unless you are covered by an insurance policy provided by the replacement vehicle provider, you may be held liable for the cost of the hire of the temporary replacement vehicle should the temporary replacement vehicle provider fail to recover the full cost from the at-fault driver or if you are ultimately considered to be at fault for the accident. You should check the hire terms of any temporary replacement vehicle you are provided with to ensure you understand what risks you are taking on.
- You may be asked questions about your need for any replacement vehicle and you may be required to sign a Mitigation Declaration Statement to confirm your circumstances.
- Other losses
- You can also make a claim if you have been injured in the accident or have suffered other losses (eg legal costs, recovery of any excess you have paid under your motor insurance policy and loss of earnings). Depending on the terms of your motor insurance policies (for example, whether you have motor legal expenses cover), your insurer may or may not assist you with recovering these losses.
Your rights if an accident is both your and the other driver’s fault, or fault is not agreed
- If there is a dispute about who is at fault in an accident, it may have to be decided in court. If both of you have some fault, you will only be able to recover from the other driver some of what you have lost, though if you have a comprehensive motor insurance policy you will still be entitled to your full rights set out in that policy.
Different ways in which your claim can be handled
- If the accident is your fault, even partially, any claim you make against your insurance policy will usually be handled by your insurer.
- If the accident is the fault of another driver, you can pursue the claim yourself but claims are typically handled in one of the following ways:
- By a claims management company: you, your insurer or the insurer of the other driver may choose for your claim to be handled by a claims management company that specialises in making a rapid assessment of liability and will support you through the presentation and settlement of your claim.
- By a solicitor: you or your insurer may choose to have your claim handled by a solicitor.
- By your own insurer: your insurer will handle your claim under your own motor insurance policy and recover the costs of the claim from the insurer of the other driver. Your insurer may choose to refer you to another supplier for the provision of some services.
- By the insurer of the other driver: the insurer of the other driver may contact you following an accident and offer to handle your claim, which you can choose to accept if you wish. They will be focused on reducing their costs and minimizing the extent of your claim at a time make certain that you understand your legal entitlement to compensation and redress before considering any offer.
- The rights you have to claim against your insurer and your insurance policy are the same whoever is at fault for an accident or whether there is any dispute over who is at fault.
- If you have comprehensive motor insurance cover, your policy will in most circumstances provide cover for repair of your vehicle or compensation for its value before the accident if it is a write-off. It may also cover you for other areas, such as a temporary replacement vehicle, which may not be of the same size, status or engine capacity as your own damaged car.
- If you have third party or third party fire and theft cover, your policy will not provide cover for repair to your vehicle or provide you with a temporary replacement vehicle.
- If you have motor legal expenses cover or decide to purchase such cover after the accident, you may be covered for the legal costs of pursuing your claim.
- You should check the documentation provided with your insurance policies to understand exactly what cover is provided.
- Your legal entitlements are the same under all of these options.
This information is based on the output of a CMA sponsored working party attended by members of the ABI, BIBA, the CHO and the CMA. In 10.14 of the Final Report, the CMA stated that “at these meetings there appeared to be industry-wide support for additional information to be given to consumers concerning their rights following an accident. We believed that this proposal would go a long way to ensuring that customers were aware of their legal entitlements. Although not pursuing this as a remedy, we encourage insurers, the ABI, brokers, BIBA and others to continue with the process of seeking a standardised form of words and disclosure practice which will provide consumers with information on a timely basis about their post-accident entitlements.”