Upheld: Motor insurance, total loss valuation complaint against Collingwood Insurance Company Ltd
Financial Ombudsman decision DRN-5006452 of 2024-09-05T00:00:00+00:00. Motor insurance, total loss valuation complaint against Collingwood Insurance Company Ltd. Outcome: Upheld.
Decision detail
| Reference | DRN-5006452 |
|---|---|
| Decision date | 2024-09-05T00:00:00+00:00 |
| Firm | Collingwood Insurance Company Ltd |
| Product | Other regulated product |
| Claim type | Motor insurance, total loss valuation |
| Outcome | Upheld |
| Remedy | Collingwood must pay Mr L £1,165.67 (the shortfall between £9,474.33 paid and £10,640 fair valuation) plus 8% simple interest per year calculated from one month after the date of claim settlement until the date of payment. |
Summary
Mr L complained that Collingwood's valuation of his stolen van at £9,474.33 was too low, believing it worth over £14,000. Collingwood had obtained three motor trade valuations (£8,014, £9,760, £10,640) and offered the average without supporting evidence. The ombudsman upheld the complaint, finding the average valuation unfair and determining the fair market value should be £10,640 (the highest valuation) because Collingwood provided no evidence justifying a lower offer. Mr L was awarded £1,165.67 plus 8% interest.
The Ombudsman's reasoning
The ombudsman found that Collingwood's average valuation of £9,474.33 was not fair because it sat in the middle of three closely-grouped valuations without supporting evidence justifying a lower offer. The ombudsman applied the principle that when valuations from guides do not vary significantly and no corroborating evidence supports a lower valuation, the highest valuation should be used as the starting point to avoid detriment to the policyholder. The engine repair work was disregarded as it was a repair rather than replacement, already factored into the trade guides' valuations.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Collingwood Insurance Company Ltd, all decisions | 23 | 50% |
| Motor insurance, total loss valuation, all decisions | 3,418 | 34% |
| Other regulated product, all decisions | 51,105 | 30% |
Source
Read the original decision on the Financial Ombudsman Service website