More than a third of motorists are left out of pocket after being involved in a road traffic collision that was not their fault, new research has revealed.
As many as 36% of drivers surveyed by the RAC said they had lost out financially following an accident. The majority of these (21%) stated they had to pay their insurance policy excess while 8% said they had to fork out for travel expenses such as a hire car as a result of theirs being off the road or written-off. Four per cent claimed to have suffered loss of earnings and 3% had to cover the cost of making a personal injury compensation claim.
The average amount paid out by motorists we surveyed to cover policy excesses in non-fault insurance claims is £215 – with 41% stating they had to pay between £150 and £349. Those who had incurred travel expenses after their collisions on average had to pay £588. And, those who had to fund their own personal injury compensation claims, paid over an average of £2,036, but the highest uninsured losses figure recorded was for loss of earnings at £3,091.
Of all the 2,062 motorists questioned around a fifth (19%) admitted they had been involved in a car accident in the last five years and of these more than two-thirds (69%) said the other driver had been ‘at fault’.
Six in 10 of those surveyed (60%) said they had legal expenses insurance in place to cover uninsured losses after accidents such as policy excesses, travel expenses and the cost of pursuing personal injury compensation claims. Among those who did not have cover (29%) four main reasons were equally cited for not taking it out: too expensive (19%); ‘didn’t think I would ever need it’ (19%); ‘had it in the past and didn’t ever use it’ (20%) and ‘waste of money’ (22%).
Nearly half (48%) of those with motor legal expenses insurance said they had chosen to protect themselves because it gave them peace of mind, 40% thought ‘it was better to be safe than sorry’ and 40% believed it to be an inexpensive way of recovering any losses not covered by their car insurance policy and pursuing a personal injury claim.
Asked how much legal expenses insurance costs, the vast majority (79%) believed it cost £20 or more. In reality the typical cost of a motor legal expenses policy is around £30. Ten per cent of all those who responded to the RAC Legal Care Plus survey said they had made a claim under a legal expenses insurance policy, with the average claim being settled for £5,096.
RAC Legal Services general manager Paul Evans said: “Many people believe that the at-fault party’s insurer will cover all the costs following a collision, but this is not the case as even in the best scenarios drivers still have to pay their excesses which could easily be £150 or more. Add in to that travel expenses, loss of earnings and the cost of making a personal injury compensation claim and it must surely be wise to make sure you have cover.
“We will be working to let motorists know they can buy motor legal expenses insurance directly as a standalone product, as our research found that most tend to think it is only really sold as an add-on when taking out car insurance.”
RAC Legal Care Plus also covers the individual rather than just the vehicle they drive, which ensures policyholders are covered whatever vehicle they are driving. It also provides financial help to pay for a solicitor if policyholders face prosecution for a motoring offence which they want to contest and covers legal expenses for disputes that may arise after buying or selling a car, or any issues relating to poor garage servicing or repair work.
The RAC survey reveals one glaring, Captain Obvious, undeniable truth; people want to have their cake and eat it.
Either you believe taking out separate cover on reclaiming travel, loss of earnings and policy excess is a `waste of money’ or you don’t. If you think you’ll never need such extra layers of insurance cover, then don’t moan when someone crashes into your car and – guess what – you need to claim for a journey home, loss of a few days work, plus a £250 excess on your policy.
Car insurance covers specific, named risks, mainly to the car, not your lifestyle or every possible expense that may arise after a road accident. As the RAC notes, people can buy the extra cover relatively cheaply, but they choose not to.