Insurance claim - does the insurer claim excess from 3rd party at fault driver?

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Benoire

2798 posts

Uber Geek

#303878 16-Mar-2023 18:13

Our car was backed in to and suffered damage on the drivers side door and front quarter panel on our street. We know who did it (neighbours friend) but given their age and financial position we are concerned that if we claim from their insurance they will have pay the excess rather than us. I can't find anything on this and wondered if this was correct, does the at-fault party have to pay our insurance excess via their own insurance firm (they have only 3rd party)?

We do not know their insurance firm yet but ours is AAI.

Anyone got any views, thoughts, experience? We've lodged the claim already but not identified the driver yet.

Cheers

Chris

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1571 posts

Uber Geek

#3050942 16-Mar-2023 18:24

The excess on a policy applies to the policy holder.

So if you have a $1000 excess on your policy you're paying the first $1000 if you make a claim against your policy. Whether the insurance company will "go after" the 3rd party to recover funds is completely dependent on the company and claim. Chances are they will as they're a business. In which case it _typically_ falls on the other insurance company (assuming the 3rd party has one). If not then they might go after them through the courts to recover costs - can get messy for that person if they cannot fund it. Of course this is all if you know their details rather than a "dunno who did it, was in a car park whilst I was in the mall" type of scenario. If that 3rd party has insurance then the excess they have applies to them with their insurance company.

Benoire

2798 posts

Uber Geek

#3050950 16-Mar-2023 18:32

nzkc:

The excess on a policy applies to the policy holder.

So if you have a $1000 excess on your policy you're paying the first $1000 if you make a claim against your policy. Whether the insurance company will "go after" the 3rd party to recover funds is completely dependent on the company and claim. Chances are they will as they're a business. In which case it _typically_ falls on the other insurance company (assuming the 3rd party has one). If not then they might go after them through the courts to recover costs - can get messy for that person if they cannot fund it. Of course this is all if you know their details rather than a "dunno who did it, was in a car park whilst I was in the mall" type of scenario. If that 3rd party has insurance then the excess they have applies to them with their insurance company.

Ok thanks, so in this case our neighbour has confirmed their visitor did reverse in to the side of the car and that they have 3rd party insurance with fire and theft. What we are trying to understand is whether, as a result of our claim and naming them in the claim, they will have to pay what ever their insurance excess is as a result of our claim on their policy via our insurer... We've always just claimed on the insurance of another party without worrying about it but in this case given the very old age of the person involved I am just not comfortable given the cost of living on older people and would only look to claim from our insurance if they would not be caught liable for any excess from their fault accident.

lucky015

743 posts

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#3050954 16-Mar-2023 18:45

In this case your insurer would contact their insurer, your insurer would get the full amount for repairs from their insurer and you should not be charged an excess. Their insurer would charge them excess and apply any penalties they decide to their policy such as price increase/loss of no claims bonus.

The insurer of the damaged vehicle will always try and claw back the full cost of repairs from the party who did the damage or their insurer if provided.

If you where to claim on your policy without providing info for who did it then you would be charged excess instead and your policy would be the one potentially impacted (probably to a lesser degree than an elderly person).

TLDR - Excess applies only to the policy holder or person on the policy making the claim, Full cost of damages applies to the person who did the damage or their insurance provider if applicable. Additionally excess is waived if you provide the info for the person at fault and they are deemed liable.

johno1234

2797 posts

Uber Geek

#3050955 16-Mar-2023 18:52

“Knock for knock” system means insurance companies don’t charge each other.

My insurance company has not left me with the excess where it is accepted that the other party was at fault but I don’t think they ever charged the other party as long as they are themselves insured.

Benoire

2798 posts

Uber Geek

#3050958 16-Mar-2023 19:00

johno1234: “Knock for knock” system means insurance companies don’t charge each other.

My insurance company has not left me with the excess where it is accepted that the other party was at fault but I don’t think they ever charged the other party as long as they are themselves insured.

So, without knowing the exact process, is it reasonable to assume that the at fault party would not have to pay their own excess if we make a claim and note them down as the driver at fault? There are no details on line around this hence the questions.

johno1234

2797 posts

Uber Geek

#3050959 16-Mar-2023 19:06

Benoire:

johno1234: “Knock for knock” system means insurance companies don’t charge each other.

My insurance company has not left me with the excess where it is accepted that the other party was at fault but I don’t think they ever charged the other party as long as they are themselves insured.

So, without knowing the exact process, is it reasonable to assume that the at fault party would not have to pay their own excess if we make a claim and note them down as the driver at fault? There are no details on line around this hence the questions.

I expect the other (at fault) party will have to pay their own excess - if indeed there is even any damage to their car. If they backed into your door with their towbar there might not be and they'd get away without any direct cost but there would be a mark on their policy.

I am not a lawyer though.

Benoire

2798 posts

Uber Geek

#3050960 16-Mar-2023 19:09

with 3rd party only, they won't be claiming for their car (most likely only bumper rub on their car).... The person is near 90 and living in Auckland hence my hesitency around claiming from them if they would be stung by their own excess... there is no clarity around this aspect.

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johno1234

2797 posts

Uber Geek

#3050964 16-Mar-2023 19:16

Benoire:

with 3rd party only, they won't be claiming for their car (most likely only bumper rub on their car).... The person is near 90 and living in Auckland hence my hesitency around claiming from them if they would be stung by their own excess... there is no clarity around this aspect.

There is no excess for them as they are not claiming - that's my take anyway. I wouldn't expect them to be paying your excess.

As I say, I'm not a lawyer though. To be super duper sure you need to ask your insurance company to clarify.

nova

250 posts

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#3051041 16-Mar-2023 22:10

johno1234:

Benoire:

with 3rd party only, they won't be claiming for their car (most likely only bumper rub on their car).... The person is near 90 and living in Auckland hence my hesitency around claiming from them if they would be stung by their own excess... there is no clarity around this aspect.

There is no excess for them as they are not claiming - that's my take anyway. I wouldn't expect them to be paying your excess.

As I say, I'm not a lawyer though. To be super duper sure you need to ask your insurance company to clarify.

They would normally make a claim against their third party policy, which covers their legal liability, and in that case they would pay the excess for their policy. They don't pay your excess, and your insurer wouldn't charge you this if you were not at fault. If the person who was at fault didn't claim on insurance, then your insurer would pursue them directly for damages. The other option is that they just pay to get your car repaired directly, and you don't go through insurance.

Handle9

11387 posts

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#3051042 16-Mar-2023 22:14

The other party will likely need to pay their excess. Given their age it's also reasonable to question whether they are still competent to have a drivers license.

Sometimes being kind to others in these circumstances is actually doing them, and potentially others, harm.

russelo

328 posts

Ultimate Geek

#3051053 16-Mar-2023 22:53

My wife backed into another car last year. We only have third party, fire, and theft for our car. The other car claimed for insurance. However we didn't pay any excess for the damage to the other car as we didn't make the claim ourselves.

Late last year my car was stolen. It was on third party, fire, and theft.
I claimed for insurance and I have to pay an excess.

All these was on Trademe Insurance.

KrazyKid

1238 posts

Uber Geek

#3051059 17-Mar-2023 00:12

As others have said, the third party (if they claim) will pay excess as per the rate set on their policy. You will pay no excess.

One option to help them out is to either convince the insurance company that you want to claim on your policy only. But they may want to chase the personbat fault regardless, and you will pay your excess and have a crash in your claim history.

The other option is to let the third party make the claim and gift them the amount of the excess. Effectively pay the excess on their claim for them.

I suppose you could just not claim and pay for your repair yourself as a third option.

Benoire

2798 posts

Uber Geek

#3051065 17-Mar-2023 06:28

Thanks for the replies folks. We have asked for the details. We don't want to affect our premium or no claims bonus as insurances are increasing anyway and we don't want to put it up further plus they did actually hit the car... We're already up for a clutch replacement on the S4 which is why it was on the road in the first place and not the driveway so really our excess could be spent better elsewhere.

Senecio

2710 posts

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#3051070 17-Mar-2023 07:53

The only way for you not to pay an excess and not to incur increased premiums is to name the other party.

duckDecoy

896 posts

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Subscriber

#3051213 17-Mar-2023 14:40

I think there is another aspect you need to always consider. You are obliged to tell your insurance company the details of the other party if you know who they are. If you don't you are breaching the contract you signed.

If your insurance ever discovered that they would likely cancel your insurance. Lets say they send an assessor out to ask the neighbours if any of them have a street facing camera so they can identify the car, and the neighbour happens to say 'no need, we've already told them who did it and given them their details'. You're now hosed.

And if you get your insurance cancelled you have to disclose this to all other future insurers. Who may decide you're not worth the risk.

Do the thing you are contractually obliged to do. You're the only one with something to lose here.

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