Partially upheld: total loss settlement valuation and salvage deduction fairness complaint against Admiral Insurance (Gibraltar) Limited
Financial Ombudsman decision DRN-6141797 of 2026-05-11T00:00:00+00:00. total loss settlement valuation and salvage deduction fairness complaint against Admiral Insurance (Gibraltar) Limited. Outcome: Partially upheld.
Decision detail
| Reference | DRN-6141797 |
|---|---|
| Decision date | 2026-05-11T00:00:00+00:00 |
| Firm | Admiral Insurance (Gibraltar) Limited |
| Product | motor insurance |
| Claim type | total loss settlement valuation and salvage deduction fairness |
| Outcome | Partially upheld |
| Remedy | Admiral to increase valuation to £12,222 and pay Mr H £383.58 additional settlement after deductions for policy excess (£250), salvage (33%, £4,033.26), and interim settlement (£7,555.16). Interest at 8% simple per annum from date of interim payment to final settlement. Tax deduction certificate to be provided if requested. |
Summary
Mr H and Mrs N complained about Admiral's total loss settlement for their damaged car, disputing both the valuation and the 33% salvage deduction. Admiral initially offered £11,649.50, but Mr H believed the car was worth £13,000-£14,000. The ombudsman found the highest motor valuation guide figure of £12,222 was fair and required Admiral to increase its offer accordingly. However, the ombudsman upheld the 33% salvage deduction as reasonable, finding it supported by Admiral's commercial salvage contract and consistent with insurance law principles. The ombudsman also found no avoidable delays in claim processing. Admiral was required to pay the additional settlement with interest.
The Ombudsman's reasoning
The ombudsman applied FOS's approach that insurers should pay the highest motor guide valuation unless evidence supports a lower amount. The highest valuation of £12,222 was accepted by both parties and supported by the guides. Regarding salvage, the ombudsman found it fair and reasonable for Admiral to deduct 33% based on its commercial salvage contract, as this reflects what Admiral would have received and aligns with insurance principles that insurers retain damaged items in total loss claims. The policy terms permitted Admiral to take possession of the vehicle. The ombudsman found no avoidable delays in the three-week claim processing period.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Admiral Insurance (Gibraltar) Limited, all decisions | 1,935 | 44% |
Source
Read the original decision on the Financial Ombudsman Service website