Not upheld: undervaluation of motor insurance claim settlement complaint against esure Insurance Limited

Decision detail

Summary

Mr A complained that esure undervalued his car at £1,885 following a total loss claim, believing it was worth around £3,000 based on two adverts for similar cars priced higher. esure had delegated the valuation to company C, which consulted three trade guides producing valuations of £1,885, £1,825, and £1,268, and settled at the highest figure. The ombudsman rejected Mr A's complaint, finding that trade guide valuations are more reliable than individual adverts as they are based on nationwide research, and that esure's settlement at the highest trade guide valuation followed proper FOS methodology and was fair.

The Ombudsman's reasoning

The ombudsman applied FOS's standard methodology for vehicle valuation disputes, which prioritizes trade guide valuations over individual adverts as more reliable indicators of market value based on nationwide research. The ombudsman noted that advertised prices are not necessarily selling prices and that two similar trade guide valuations (£1,885 and £1,825) indicate the market value was likely around that figure. esure settled at the highest trade guide valuation (£1,885), which aligns with FOS's preferred approach to minimize detriment to policyholders.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website