Not upheld: unfair settlement valuation complaint against Advantage Insurance Company Limited

Decision detail

Summary

Mr G complained that Advantage Insurance's settlement of £3,200 for his total loss car was unfair, arguing it was worth £4,800 based on recent maintenance and his locality. Advantage had valued the car using motor guides and offered £3,200 after a minor deduction. The ombudsman found the settlement fair as it closely matched the highest motor guide valuation (£3,240) and complied with FOS's approach to car valuations. The ombudsman rejected Mr G's arguments regarding location and maintenance, finding no evidence that comparable cars in his area were cheaper or that maintenance increased market value. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied FOS's approach to car valuations, which prioritises motor guide valuations as most persuasive due to their extensive nationwide research. Given current market challenges, FOS expects insurers to pay the highest guide valuation unless evidence supports a lower figure. Advantage's final valuation of £3,200 was very close to the highest guide valuation of £3,240. The ombudsman rejected Mr G's arguments that location justified a higher valuation and that recent maintenance increased market value, finding that maintenance only keeps a car roadworthy but doesn't increase its market value. The advertised cars Mr G provided were not comparable as they were different models, newer, or had lower mileages.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website