Car hire ruling can make life easier for innocent drivers: Insurers may be pressurised into settling claims more quickly

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A RECENT court case has given the green light to hiring a car if a vehicle is off the road as the result of an accident caused by another driver.

The case is likely to result in insurance companies settling claims much more quickly.

Most motor insurance policies do not cover the cost of hiring a car. The charges can only be covered by claiming on the policy of the driver whose fault the accident was.

Until the case, it was impossible to claim for a hire made while a car was off the road awaiting repairs that you could not afford to make.

But the court has decided that it is reasonable to expect any hire charges to be met by the offending driver's insurance company.

The facts of the case have a familiar ring. After a car accident, one driver hired a car for a period of four months while he was waiting for the other party's insurers to settle his claim.

It was argued that the hire expenses were unreasonable and that he should have used buses, trains and taxis instead of hiring a car for the entire period.

The judge said that in this day and age any motorist who loses the use of his car behaves reasonably by hiring one in its place.

Paul Coppin, of solicitors Birkett Westhorp and Long of Ipswich, said: 'Once you have obtained two estimates for the repairs there is nothing further you can do as regards the repair of your vehicle. So you should be able to go out and hire a replacement for as long as it takes the other driver's insurers to settle the claim.' It is a condition that losses are kept to a minimum. If, for instance, you lived in the centre of London and a hire car did nothing but stand in the garage all week, claiming the charges would be questionable.

If you used a car at weekends to go to the country, however, there would be no reason why you should not hire one every Friday.

The case means that mounting hire charges will be ticking up for the insurance companies.

According to Mr Coppin: 'Whereas before if you put a dink into your car worth about pounds 400 the insurance companies did not feel pressed by time, now it is in their financial interests to get on with it as quickly as possible. This case will undoubtedly have the effect of speeding up claims.'

If you do not hire a replacement vehicle, you can claim a sum of money for the inconvenience of being without a car.

'You use precedent and case law for calculating how much to claim. There are some cases saying pounds 35 a week and some saying pounds 80,' Mr Coppin said. 'If you have an invalided daughter who needs to be run around more than normal then you would be claiming more rather than less.

'There is no blanket figure but it is common now to see claims of pounds 60 or pounds 70 a week.'

If an insurance company delays settling it could end up paying out more in loss of use or hire charges than the car is actually worth.

Mr Coppin added: 'Now not only the insured but also the insurance companies have an interest in settling the claims as quickly as possible.'

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