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Motor Insurance - The Loss of Use Policy Exclusion
By: Trevor Dace
In this article we will be looking at the "loss of use" exclusion clause in your motor insurance policy.It specifies what alternative transport your insurance company will offer to you if your own car is off the road because of theft or accident. In most cases the answer is nothing !!
Certain insurers have a network of retained repair shops who will offer you a courtesy car if one happens to be available. A small number of insurers have a car hire scheme written in to their policy whereby they will provide a vehicle for you from their chosen car hire company. However, most insurers do not offer either of these options.
Most insurers offer a car hire option to their comprehensive policies. The option is far from cheap and the policy cover is rather limited. You need to decide if you feel it essential that you purchase it. It is far from an essential extra for everyone. Answer these questions:
If my vehicle was inoperative would it be possible for me to :
- get to work (by bus, cycle, train, walk)?
- take the children/grandchildren to school?
- go shopping
- go on holiday?
- follow my hobbies, social interests, sports etc?
If you could manage without a vehicle for a few days, you do not need to purchase this extra cover. If you're sure that you can't then you should check that you have this cover.
Remember, if your car is stolen or an accident is your fault, you won't be able to recover any car hire costs from a third party. You won't be able to go and see a 'credit hire' company. You can't rely upon the prospect of a replacement car from the repairers. So this additional cover becomes worthwhile for you.
Similarly, if you do not want to use your insurer's recommended repairer, or your car is a total loss, the car hire extra cover will come to the rescue. Let's take a look at what you might expect from a typical policy.
You can only hire a car if yours is disabled for more than 2 days, and the maximum period of hire is fourteen days. If the hire car is required for longer than this you will have to pay the additional cost to the car hire firm. There's been many an argument between car owner,insurer and repairer when repairs have overrun because of non-availability of parts and nobody wants to pay the extra car hire costs.
You cannot claim a hire car for a glass only or windscreen claim.
There is normally a delivery maximum so if you live out in the sticks and the hire company is some few miles away from you, be prepared for an extra charge if you require them to deliver it to you. Is it possible for you to get to their nearest depot yourself?
Your own motor insurance policy will cover the hire car for comprehensive benefits. That helps the insurer to keep down the cost of the hire car cover but if you are involved in an accident whilst using the hire car, the insurance claim will be on your policy.
The hire car can only be claimed from the date your car goes in for repair if the damage to your car is such that it is still safe and legal to drive. If your car is not roadworthy you can have the car from the day of the accident.
Policies might define a maximum hire period, such as fourteen days. If your vehicle is repaired prior to this date, you must return the hire car as soon as you have your vehicle back.
The hire car supplied will almost certainly be a basic, manual gearbox model no more than a couple of years old. If you need a larger model you will probably have to pay a supplement. If you require an automatic they will try to find one for you within the vehicle groups specified in the policy. The hire car will normally come complete with a tank full of fuel. It must be returned with a full tank. If you don't you will be charged by the hire company for a fill up. And they charge a very high price for topping up tanks!
Some hire firms will ask for an imprint of your credit card, insuring against the possibility of having to fill up your car or bumping it whilst out and about.
Article Source: http://www.uberarticles.com/articles
This article explaining the loss of use clause of a motor insurance policy was written by Trevor Dace. He has many years of experience working in the claims office of a number of UK insurance companies. His website www.instant-online-insurance.co.uk offers Over 65 holiday insurance.
This article is licensed under a Creative Commons Attribution-No Derivative Works 3.0 Unported License, which means you may freely reprint it, in its entiretly, provided you include the author's resource box along with LIVE links (without "nofollow" tags).
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