Having the use of a courtesy car while your own is being repaired following an accident is something most drivers insist upon under the terms of a car insurance policy, but it seems that many are being stung with hefty legal bills after unknowingly using replacement vehicles that are actually not entitled to.
These motorists have used hire cars after being hit by another vehicle, but a growing number of third party management firms have been leasing them at vastly inflated prices and sending the bill to the at-fault driver's insurance company.
The cost is often disputed by the insurer forcing the hire company to seek recompense from the driver using the 'courtesy car', and because a signed credit agreement is involved in the lease, the driver soon discovers that they are legally responsible for the unpaid bill.
A battle over the hire car costs then ensues between two insurers with the unfortunate driver who has been using the vehicle as a temporary measure in good faith stuck firmly in the middle.
Car insurance companies and the independent Financial Ombudsman Service express a joint concern as this situation threatens to become a significant problem, particularly for the motorist, who could expect a typical car insurance quote to suddenly get bumped up by around £80 a year as a result of these disputes.
But ironically the problem has arisen from the insurers own making, as some accident management firms are actually exploiting a legal loophole in the insurer's own rules.
Some have been found to follow a practice of leasing courtesy cars that are not compatible to those stated in the terms of the driver's policy, and what is not always made clear is that the courtesy car is rented and what the driver is being asked to sign before they drive it away is actually an agreement to take the vehicle on credit.
This kind of legal responsibility is not something most drivers would be willing to take on, so the general advice would be to clarify the arrangements concerning courtesy cars before purchasing any insurance policy.
Fore-warned is fore-armed and specific issues on existing policies can always be discussed with the providing insurer at any time by worried customers, so the likelihood of becoming a victim of such a scam can easily be avoided.
These motorists have used hire cars after being hit by another vehicle, but a growing number of third party management firms have been leasing them at vastly inflated prices and sending the bill to the at-fault driver's insurance company.
The cost is often disputed by the insurer forcing the hire company to seek recompense from the driver using the 'courtesy car', and because a signed credit agreement is involved in the lease, the driver soon discovers that they are legally responsible for the unpaid bill.
A battle over the hire car costs then ensues between two insurers with the unfortunate driver who has been using the vehicle as a temporary measure in good faith stuck firmly in the middle.
Car insurance companies and the independent Financial Ombudsman Service express a joint concern as this situation threatens to become a significant problem, particularly for the motorist, who could expect a typical car insurance quote to suddenly get bumped up by around £80 a year as a result of these disputes.
But ironically the problem has arisen from the insurers own making, as some accident management firms are actually exploiting a legal loophole in the insurer's own rules.
Some have been found to follow a practice of leasing courtesy cars that are not compatible to those stated in the terms of the driver's policy, and what is not always made clear is that the courtesy car is rented and what the driver is being asked to sign before they drive it away is actually an agreement to take the vehicle on credit.
This kind of legal responsibility is not something most drivers would be willing to take on, so the general advice would be to clarify the arrangements concerning courtesy cars before purchasing any insurance policy.
Fore-warned is fore-armed and specific issues on existing policies can always be discussed with the providing insurer at any time by worried customers, so the likelihood of becoming a victim of such a scam can easily be avoided.