Upheld: Motor insurance, total loss valuation complaint against Wakam UK Limited
Financial Ombudsman decision DRN-5922111 of 2026-01-13T00:00:00+00:00. Motor insurance, total loss valuation complaint against Wakam UK Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-5922111 |
|---|---|
| Decision date | 2026-01-13T00:00:00+00:00 |
| Firm | Wakam UK Limited |
| Product | Other regulated product |
| Claim type | Motor insurance, total loss valuation |
| Outcome | Upheld |
| Remedy | 1. Increase valuation to £4,959 and pay this amount less policy excess. 2. Add 8% simple per annum interest on the difference between the initial offer (£4,140 less excess) and £4,959 from 29 May 2025 until final payment. 3. Pay £100 compensation for distress and inconvenience caused by poor handling of the claim. |
Summary
Mr B complained about Wakam's settlement for his car damaged by fire. Wakam initially offered £4,140 but withdrew this upon discovering the car was purchased recently, then offered £2,519.60 based on a policy term requiring the lower of market value or purchase price. The ombudsman found this term was unusual and not adequately highlighted at sale, making it unfair to apply. Additionally, Wakam's valuation of £4,440 was unreasonable due to incorrect mileage and unjustified damage deductions, and lacked supporting evidence. The ombudsman upheld the complaint, requiring Wakam to pay the highest motor guide valuation of £4,959 plus interest and £100 compensation for poor service.
The Ombudsman's reasoning
The ombudsman found the policy term requiring the lower of market value or purchase price to be unusual and restrictive, and determined it was not sufficiently highlighted to Mr B at point of sale or in summary documents, making it unfair for Wakam to rely upon it. The ombudsman applied standard industry practice requiring payment of pre-loss market value. Wakam's valuation was unreasonable as it used incorrect mileage and made an unjustified deduction for pre-existing damage, and Wakam provided no evidence supporting a valuation lower than the highest motor guide valuation of £4,959. The ombudsman also found Wakam's service was poor due to withdrawal of the initial offer, incorrect statements about modifications, and failure to keep Mr B updated.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Wakam UK Limited, all decisions | 16 | 69% |
| 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