Not upheld: unauthorized disposal of vehicle and handling of total loss claim complaint against Tradex Insurance Company PLC

Decision detail

Summary

Mr O complained that Tradex Insurance disposed of his car at auction without his consent while he disputed the total loss valuation settlement. Tradex had settled the claim as a total loss due to the extent of damage and paid an interim settlement in December 2024. Mr O only discovered the car had been sold in February 2025 and complained that Tradex should not have disposed of it while the valuation was disputed. The ombudsman found that Tradex acted reasonably, as it is standard practice for insurers to dispose of salvage after settling a total loss claim, Mr O had not requested to retain the vehicle, and Tradex had clearly explained its process to him. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the general principle that when an insurer pays out for a total loss, it is entitled to retain or dispose of the damaged item. The ombudsman noted that insurers are not expected to offer salvage retention unless a customer asks. The ombudsman found that Tradex clearly informed Mr O of its total loss process and what would happen to the vehicle. Critically, Mr O never asked to retain the car. The ombudsman was not persuaded that Mr O would have acted differently even if offered the option, given that he urgently requested the interim payment to purchase a replacement vehicle. The ombudsman concluded that accepting the interim payment did not affect Mr O's right to dispute the valuation, and that the dispute was about valuation amount, not vehicle ownership.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website