Hoping someone with a bit of automotive legal/insurance knowledge can help with this. I'm totally flummoxed!
A 17 y.o. P-plater rear-ended my daughter in her lovely little low-km Mitsubishi Colt at a controlled intersection a few weeks ago. The chassis is twisted and it's a write-off. She's not very well-off, so she only had 3rd party etc insurance (in W.A.). The car had 69,000km on it - but was 2007. We paid a bargain ~$7,000 for it in late 2020…a great deal at the time. Replacement cost for something at even 3X the km of same age is roughly $8-9,000 from a dealer. Prices on 2nd-hand market are much higher recently.
The P-plater was not displaying his plates (we have photos).
His Dad initially seemed reasonable, and offered to make everything right - BUT, his insurer was not impressed by his son's accident as a P-plater and (presumably) rejected the claim. Dad then offered to make it right anyway.
The problem is that he claims that his liability is limited purely to the max value an insure would pay in a 3rd-part claim - which is ~$4100. But my daughter is facing a replacement cost far in excess of that. Additionally, the Dad insisits that we must surrender the damaged car to him as part of the $4100 pay-out - as this is what would happen if the hypothetical insurer had paid out.
My gut's churning on this. It just seems really unfair that my daughter is up for a huge bill to make up the loss (in purchasing an equivalent replacement vehicle) - which is wholly NOT her fault.
Do we have any leg to stand on? Or, must we accept this really mean-spirited offer? We're going to have to dip into our meagre retirement savings to help her buy a replacement.
Apparently, the Dad is being advised by some mate who's an insurance industry guru!
BTW, in the meantime, it looks like our daughter is also suffering effects of concussion from the incident - according to her GP and hospital A&E. We haven't yet mentioned that to the Dad.
I'm sure there'll be opinions on this, but it would be good if someone with professional knowledge could advise. Thanks.
Liability for Crash Write-off. Help!
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Sound more like a problem in his understanding.
I mean what kind of 3rd party insurance would only pay out $4100? It defeats the entire point of 3rd party. What if she hit a lambo.
Should speak to a compensation lawyer for advice and options for personal injury for your daughter. You will be surprised with the stuff they can conjure up as a claim.
There's a lot of ' no win no fee' firms out there but beware, should you be successful in a claim a chunk will be withheld for fees. In NSW think the fee structure is regulated so some research will be needed here.
If dad wants to make it right, tell him to find a replacement vehicle and pay all the costs to get it back on the road. Tell him you want something the same age and milage, 1 owner etc. Make him do all the work.
Effectively, its sounds like there is no insurance to help out as you only (daughter) have 3rd party and the other party has third party but for some reason cant claim on. This comes down to making an agreement which has happened. I think your best bet is just presenting some examples of equivalent cars on carsales and try to negotiate the offer up. If we are only talking about a thousand here and there it won't be worthwhile involving lawyers. Also, I dont see any harm in handing over the car upon a satisfactory payout as thats what happens with insurance payouts anyway. Maybe just cancel the plates first and cash in on the rego.
Firstly, I am sorry that this has happened to you and your daughter. Definitely unfun and her medical issues as a result of this does not sound good at all.
Secondly, I know that you've said that you're going to Legal Aid but, for everyone else, this will help for people in the same position.
Thirdly, as it is literally my job to advise about Insurance, the general advice I can give you is to talk to your daughter's Insurer, even though it is TPP/CTP because there is usually something written in there about what happens (like in your case) that an accident happens without it being your fault. They may also be helpful in challenging the other party on their claim and get something through.
Happy if you want to DM me.
…. and this is why I pay for comprehensive car insurance.
No comprehensive insurance - you are going to have a very hard time. I think 4k for such an old car is reasonable. If you feel it's not right then start a civil claim in small claims court.
Personally i'd be taking the 4k in this case and having comprehensive insurance next time.
Yeah just take the 4K tell your daughter to find a car for 4K until she learns how to drive and get a job to buy herself a better car…
She is not at fault in case you didn’t read it properly.
You've got private messaging disabled; feel free to shoot me a PM if you want to discuss, I think I may able to assist.
The problem is that he claims that his liability is limited purely to the max value an insure would pay in a 3rd-part claim - which is ~$4100
No it isn't.
It is a civil issue and there is no automatic cap on liability.Additionally, the Dad insisits that we must surrender the damaged car to him as part of the $4100 pay-out - as this is what would happen if the hypothetical insurer had paid out.
What would happen if there was insurance is irrelevant.
It's a civil matter and you may agree to give him the car but you are under no obligation to.$4000 does sound a little low but it's not far off. Even if you had compressive cover and insured for an agreed vale, the insurer wouldn't pay much more than that for 'market value'.
First, the total pay out for a write off is only for the car. They're not legally liable to pay for your stamp duty and transfer fees. But the unused portion of the rego and greenslip you're entitled to a partial refund. So that might add a few hundred $ more to that $4100 they offered.
And no, you don't get to keep the scraps. If it's a write off, they pay you the market value of the car and they keep it to sell for parts. Cancel your rego and don't leave it too late, you'll only get refunded the unused portion.
The problem with 'market value', is that most insurers use Redbook or something similar as a guide, which is little on the low side. And doesn't include all the on road costs I mentioned earlier.
Don't use what the dealers prices are for market value, they're in business and make a huge profit. Even private sales you see on carsales, rarely end up getting that price because buyers will haggle. Alot of cars get sold through auctions too, which tend to be cheap and bring the market value down.
Most insurance covers legal liability up to $20mil. So the kid's insurance probably excluded him, otherwise he'd just pay the excess and let his insurer deal with you.
Your daughter's insurance will likely have uninsured driver protection up to $5000. Put a claim through and let your insurer deal with him. They'll try to recoup the loss from them which is alot more affective than you doing it yourself.
But again, don't be surprised if your own insurer offer you a similar payout. And you'll need to pay the excess. ( Could be wrong on this, read your PDF).
GOOD LUCK
Good advice.
With the excess question - it's usually a "pay the excess now, get it refunded in the settlement" situation
Even if you had compressive cover and insured for an agreed vale, the insurer wouldn't pay much more than that for 'market value'.
Don't you get paid the agreed value if the car is write-off? Regardless how much it is.
Apparently even if you have third party insurance, your insurance company should cover you as long as you're not at fault which you're not. otherwise, grab a few bikie mates and roll up to his dad's place and demand 8k from him.
Make him pay for the repairs, especially if repair cost is less than you can replace it for yourself. Just make sure the repairs are done right, and then you have your car back. If the repair cost is more than the full replacement cost of the vehicle he might be more inclined to accept your valuation if otherwise faced with the option to pay the (higher) repair cost.
What an insurance company may or may not pay is irrelevant as you are not dealing with an insurance company.
Insurance companies will often write off with relative minor damage because they know they can just sell the wreck and make more money. Especially with their lowball "market value".
You don't have to hand over the wreck to the Dad, but he is entitled to deduct the value of the wreck from the replacement cost in any payout.
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That's his problem because he is under-insured and need to make up the difference.
If you were driving a Ferrari it doesn't mean you only get $4100 because they didn't have adequate insurance, they will then need to make up the difference and it isn't your problem.
Tell them you will them to court for the full amount in replacement value of the car and let the court decide.