Upheld: unfair claim settlement - vehicle valuation methodology complaint against Admiral Insurance (Gibraltar) Limited

Decision detail

Summary

Mr R claimed on his motor insurance policy after his car was written off. Admiral valued the car at £19,148 (the average of four motor valuation guides ranging from £18,587 to £19,690) but Mr R disputed this, believing the car was worth more and that optional factory-fitted extras had not been considered. The ombudsman upheld the complaint, finding that Admiral should have offered the highest guide valuation (£19,690) as it provided no evidence to justify the lower average valuation. The ombudsman ordered Admiral to pay £19,690 plus 8% simple interest on the shortfall.

The Ombudsman's reasoning

The ombudsman applied FOS's established approach to valuation complaints, which requires insurers to offer the highest guide valuation unless they can provide evidence justifying a lower fair market value. Admiral simply took the average without justification. Although the 3% difference was relatively small, the absence of evidence supporting the lower valuation, combined with the possibility of unverifiable optional extras on a total loss vehicle, meant the highest guide price was the fair and reasonable outcome.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website