When a client’s vehicle is damaged, they may have insurance that will arrange and pay for repairs to be carried out.

Arranging repairs through your insurance company can mean that the length of time it takes to authorise repairs is much longer. You could also find that reimbursement of what you spend on the cost of accident car hire also takes much longer. Additionally, you may find your no claims bonus is compromised, and you would have to pay any applicable excess.

The aftermath of a motor accident can be time-consuming having to arranging fast vehicle repair services. By using a trusted garage you should be able to obtain a reasonable quote for repair services.

If your vehicle is not economical to repair the third parties insurer should offer you the vehicle’s market value. They normally then take the vehicle from you but you may be able to negotiate to keep it. This is known as an insurance write off.

If your vehicle is repairable then the third party insurer may offer to pay for the repairs (less VAT) prior to completion and on receipt of the quote. If you have had the vehicle repaired and paid in full then it is arguable that the full amount should be refunded by the third party insurers.

What is “credit hire”?

Credit hire is the supply of a like-for-like replacement hire vehicle on a credit basis to the not-at fault vehicle owner following a non-fault accident. Rather than paying for the hire of the vehicle at the time of hire, the credit hire company will attempt to recover the costs of hire from the at-fault driver’s insurer once the claim is settled. Credit hire may be available to any non-fault vehicle owner whatever their own insurance status – comprehensively insured, third party insured as the claim is against the insurer of the at-fault third party driver.

Credit hire works on the basis that the payment will be recovered from the at-fault driver’s insurance company and no charge will be payable by the (non-fault) recipient of the hire.
BEWARE: Read the contract thoroughly as there may be a clause that says if the credit hire company cannot recover all the fees from the Defendant insurer then the excess amount can be recovered from the client! There is a potential for the client to be left with a large bill if:

• they (or the driver) are held partially or wholly liable for the accident
• the hire of the vehicle is deemed too long or unnecessary
• the recipient of the hire is given a substantially better vehicle (charged at greater cost) than the one that was damaged
• the recipient of the hire has, or (arguably) could have obtained and paid for, an equivalent vehicle to their own on a non-credit basis without suffering any financial burden Credit hire should only be taken:

• if there is no doubt as to liability
• for the duration of the period of loss of use of the damaged vehicle
• the driver has no other equivalent “spare” vehicle available and without depriving another driver (usually spouse or partner) from using it; and in theory at least, the driver could not have obtained or paid for an alternative vehicle without suffering any financial barrier.

If there is any doubt of who is responsible for the accident then we would advise not to accept a credit hire vehicle. If your vehicle damage is minor and you are still able to drive the vehicle then no hire vehicle should be accepted.

Speak to us today on 0151 422 0982 to find out how we can help. Our office doors are open should you wish to stop by to discuss your claim, or you can even get in touch with us using our online form.