Financial Ombudsman interpretation of “ Market Value” of car

An interesting complaint to the Financial Ombudsman here.  A consumer buys a car at £1,000 lower than an equivalent make, model and age of vehicle but then writes it off.  Insurance company refuses to pay the market value as this would have put the consumer in a far better position.

The Ombudsman felt that if “market value” is the insurer’s wording then there must be compelling reasons why it shouldn’t pay out on that basis.  Therefore if trade guide prices were all higher than the amount paid by the consumer then the higher amount ought to be paid.  Otherwise, the insured would not be in a position to buy an equivalent vehicle for the same price again.

Published: 25 Nov 2013


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