1. Additional charges (added
23.7.07)
1. Additional charges (added 23.7.07)
Q: Some CHOs are making additional charges on things like Sat Nav etc, even when these are standard with certain cars! This must be wrong.
A: Such additional charges are not currently allowed in the GTA and certainly it is not possible ever to charge as extras items provided as standard in a vehicle e.g. automatic.
2. Additional driver charges (added 1.6.08)
Q: Can a CHO add an extra charge in their GTA invoice where tan additional driver is added?
A: No charge can be included for additional drivers unless they are a non-standard driver (see definition of non-standard drivers).
3. Administration fee for split liability cases (added 1.6.08)
Q: What happens to the £30 administration fee when there is a split decision on liability?
A: Where claims are settled on a split liability basis the £30 administration fee should be apportioned on the same basis i.e. if the decision is 50/50 then a £15 administration fee will apply.
4. Automatic vehicles (added 23.7.07)
Q: It must be wrong that some CHOs are charging £5 a day for vehicles that are only manufactured as automatic models. The vehicles are typically Mercedes and the majority of models are only available as autos as standard (although the purchaser can pay more to get the vehicle upgraded to manual). Also suggested that a vehicle being tiptronic means that a vehicle is available as a manual model.
Some CHOs are charging an additional £5 a day for an automatic when it is clear that the hirer did not possess an automatic.
A: The GTA is clear, and this is reinforced in the GTA groups and examples table:
“An additional £5 a day can be added for automatics (where this matches the customer’s vehicle) unless the model listed is an automatic.”
5. Bike hire extras (added 23.7.07)
Q: Some CHOs have suggested charging extra amounts for crash helmets/leathers. Is this correct?
A: No. There is no extra charge for any motorcycle extras in the GTA.
6. CHO Delays in answering insurer questions on the payment pack (added 1.6.08)
Q; If a CHO delays sending answers to reasonable insurer questions on the payment pack does the clock stop on payment of penalties?
A: if reasonable questions on the payment pack are asked by the TPI the CHO should reply promptly (i.e. within 10 working days) or accept they are responsible for any delay and the penalty clock will stop after the 10 days until the CHO has responded. Where the CHO is waiting for information that is beyond their control they should still notify the TPI within the 10 days so that the penalty clock continues but the TPI can then take action to try to resolve the delay.
This will not impact on the ability of a CHO to take a claim out of the GTA 90 days after the payment pack was first sent to the TPI.
7. Collision Damage Waiver recovery (added 23.7.07)
Q: Can a CDW be claimed under the GTA?
A: No, CDW is not claimable within the GTA.
8. Complaints against subscribers (added 28.8.07)
Q: Is there an agreed complaint resolution mechanism for alleged breaches of the GTA by an insurer or CHO?
A: Yes. The GTA Joint Technical Committee has set down the following mechanism for handling complaints of principle and substance about how an insurer/CHO subscriber is operating under the GTA:
· The mechanism can only be used after deadlock has been reached between the final dispute resolution contacts for the respective businesses. · Formal complaints should be sent to Tony Baker (Secretary, Joint Technical Committee Email: gtainformation@gmail.com) with supporting documentation. · Tony Baker to check the complaint, ensure it is relevant to the GTA and refine it as necessary. He should agree a final version with the complainant and then send it to the subscriber being complained about with a request for a response in writing within a reasonable period (say 2 weeks). · Either that would resolve the complaint or it would be clear there was no agreement between the two parties. They would be informed if this was the case and told it would then be sent to the Technical Committee for consideration. · The complaint and response would be sent to the committee for views with the names omitted. Committee members would be asked for their comments within a set period (usually 2 weeks). If there was no clear view the complaint would go to a meeting of the Committee to discuss.
9. Convertibles (added 23.7.07)
Q: What happens regarding rates for convertibles?
A: For customers with a convertible, unless the model listed is already a convertible, convertibles are treated by placing them into the group higher than the hard top version e.g. BMW M3 is in SP9. The convertible equivalent would be in SP10.
10. Credit repair engineer discounts (added 23.7.07)
Q: Engineers aren’t negotiating any discounts from the garages as required by the GTA. What is the position?
A: The GTA is clear in that “The engineer should negotiate appropriate market discounts to the retail rates charged by a garage including ensuring that all standard market discounts and commissions are passed on to the insurer, including labour, parts, paint and materials and engineer’s fee. The rates should not be out of line with the rates available in the locality in question.”
A complaint should be made by the TPI to the CHO who should take action regarding the engineer in question. If they fail to do so and this seems to be part a deliberate ploy of the CHO, then a complaint should be made to the Technical Committee that the CHO is in breach of the GTA.
11. Definition of 24 hours (added 23.7.07)
Q: Some insurers maintain that if the hire is one day and 4 hours then this is just a one day hire. Is this correct?
A: No. The GTA states that the daily settlement rate is the amount paid for each 24-hour period e.g. 10.00 Monday 1 July to 17.00 Monday 8 July is eight days.
12. Delays by third party solicitors (added 28.8.07)
Q: There is a trend for some subscribers to use solicitors to process GTA claims. This often causes delay as the solicitors aren’t aware of the facts or the protocol terms. Does the GTA still apply in full in such cases?
A: This applies to both insurers and CHOs and has been discussed recently by the Technical Committee. It was agreed that guidance should be issued to all GTA subscribers to the effect: “It was noted that some subscribers were passing claims direct to solicitors/claim management companies who knew nothing about the GTA. It was agreed that guidance should be issued to subscribers to ensure that any ‘agents’ acting for them on GTA claims should be aware of the GTA and how it operates and abide by its terms.”
13. Disabled driver vehicles (added 23.7.07)
Q: What happens regarding disabled vehicles?
A: Reasonable direct costs can be recovered plus an administration charge of £10 is acceptable in most instances. For any special adaptations then the CHO should discuss these with the insurer, preferably at the time the hire commences.
14. Disputes and removing claims from the GTA (added 27.2.08)
Q: There are cases where CHO's are trying to charge full commercial rates because late payment fees have been missed. Even when the insurer agrees to send payment for the late payment fee, they will only bank as an interim payment and continue to chase the difference between the amount paid, and their commercial rates. Are they are entitled to do this?
A: If for any reason a GTA claim is not fully resolved within 90 days (eg dispute over liability, dispute over length or hire, dispute over amount offered by the insurers such as on rate or failure to pay penalty charge) a CHO can remove it from the GTA.
15. Dual Controlled vehicle rates (added 23.7.07)
Q: Dual controlled vehicles - do the rates in the GTA itself para 5.3 (£12/£7) still apply i.e. are they added to the new maximum settlement rates.
A: Yes, the addition does apply. An additional £12 per day add-on to the agreed daily settlement rate for dual control vehicles (£7 per day add-on if insurance cover not provided).
16. End of hire – meaning of 24 hours (added 27.2.08)
Q: The GTA states that the hire period ends not later than 24 hours after repairs to the customer’s vehicle have been completed. Should this not be working hours?
A: No, this was not the intention. If a repair is completed on a Friday the car should be off-hire by the Saturday.
17. Estate cars (added 23.7.07)
Q: Can £5 per day always be added for an estate car?
A: An additional £5 a day can be added for estate vehicles (where this matches the customer’s vehicle) unless the model listed is already an estate.
18. Excessive hire periods (added 23.7.07)
Q: We are seeing a number of claims where the hire period is excessive. There should an agreed review/referral to the insurer contacts after a pre agreed hire period has elapsed. Cases are regularly seen where the hire continues for ‘a week or two’ beyond which the car is repaired.
Also, should there not be an automatic hire review? If a vehicle is out on hire for a long time (say 40 days), it should be bought to the attention of management for reference to the insurer’s GTA coordinator in a bid to prevent problems further down the line. Private settlements/no repairs, but customer is still in hire. Also, cases where CHOs keep clients in hire because of parts delay while own vehicle is drivable. They argue that the client ‘should not be inconvenienced’ but this is invariably just a ruse to extend the hire. A: The first two issues are covered in the GTA in that detailed monitoring and reporting is required. The issue may be more what does the TPI do with the information.
On the hire continuing for a week or two after the repair is completed the question must be why. If there is no satisfactory answer then the TPI should not pay.
Recent guidance given on this to one CHO was in response to the question “If a client is in hire and, after repairs are finished, is away on business (in our car) and so unable to return and collect his own vehicle for a period of 5-6 days, do you feel we would be able to recover this period?”
The answer given was:
“You are not entitled to the five days extra under the GTA. However, my personal view is that if this is a one off then I would raise it with the insurer and explain. Their attitude may depend on their relations with you and the length of the hire. However, what might be a compromise is to suggest a lower rate (almost an intervention rate) for the five days so the insurer sees you are not looking for profit just the best interests of your client.”
19. First to a customer (added 23.7.07) Q: I consider I was first to the customer but the CHO disagrees. What is the guidance? A: The GTA is clear (and this was certainly the intention) that whoever is first to a customer of a suitable offer that they can understand normally wins. It was felt in the discussions that it was wrong for someone to have accepted an offer from, say, an insurer only for a bodyshop to then persuade them to accept something else. Likewise if a claimant had accepted a CHO offer then it was wrong for an insurer to try and persuade them to change their mind. This is set down in para 3.1 and 3.2 of the GTA:
3.1 The overriding principle for the GTA is that whoever is first to a customer and obtains their agreement should provide the service and all subscribers should not seek to intervene. All subscribers must, therefore, not seek to transfer a customer who has agreed to accept a vehicle into an alternative replacement vehicle.
3.2 First to a customer is defined as the receipt by the customer of a suitable offer that they can understand. All subscribers communicating an offer solely by letter stand the risk of it not having been received, understood or being sufficient for the customer. If a claimant receives a suitable offer from an insurer, that they can understand, and this is before an offer from the CHO, then this should be mentioned in the mitigation statement. 20. Hire continuing after repairs completed (added 28.8.07)
Q: CHO submitted a payment pack to ourselves on 22/03/2006. The hire period was from 23/01/2006 – 03/02/2006. However, we have confirmed with their client’s garage that the vehicle was repaired and ready for collection on the 31/01/2006. As per section 4.8 of the ABI GTA hire should end no later than 24 hours after the completion of repairs. As such we paid the hire period of 23/01/2006 – 01/02/2006.
CHO then advised that their client could not collect the vehicle as they were away on business. We cannot see any section of the ABI that suggests that the hire period can be extended due to this reason and as such it is the responsibility of the CHO or their client to either off hire 24 hours after the completion of repairs or not to charge the at fault insurer for any hire past this period.
A: On the hire continuing for a week or two after the repair is completed the question must be why. If there is no satisfactory answer then the TPI should not pay.
A CHO is not entitled to the five days extra under the GTA. However, if this is a one off then the CHO should raise it with the insurer and explain. Their attitude may depend on their relations with the CHO and the length of the hire.
However, what might be a compromise is to suggest a lower rate (almost an intervention rate) for the five days so the insurer sees you are not looking for profit just the best interests of your client."
21. Hire days after total loss cheque received (added 23.7.07)
Q: I am concerned about para 4.14 of the agreement that states:
4.14 When a vehicle is deemed to be a total loss then the CHO should check within 10 working days of the hire commencing, that the vehicle has been inspected and an offer made to the customer. If it hasn't then the CHO should inform the at fault driver’s insurer. This can be extended by up to 4 working days where the CHOs procedures provide for an offer being agreed with the customer. The CHO should inform the at fault driver’s insurer of any dispute on value so they can consider any appropriate action. The hire may continue until 7 calendar days (a week) after receipt of the final settlement cheque by the customer or their representative. The at fault driver’s insurer will advise the CHO, at their request, as soon as possible of the date on which their total loss settlement cheque is issued. If any extension to these limits is sought then the CHO must contact the insurer and obtain consent that the additional period will be covered.
I am concerned of the wording underlined. I am informed by the company that is handling my no fault accident that the above said 7 days starts from receipt of any payment from my insurer, even when such payment is agreed by all parties that it is an 'interim' cheque and ‘without prejudice’. Yet the extract above clearly states different. My understanding with my insurer is that they make an 'interim' payment whilst we negotiate final payment based on whether I can realistically purchase an equivalent vehicle with an agreed settlement and when we reach a final figure then the 'final settlement cheque' is issued and the 7 days starts after receipt of that final cheque.
A: The GTA states "The hire may continue until 7 calendar days (a week) after receipt of the final settlement cheque by the customer or their representative." This is intended to be the maximum and not the norm. If a claimant buys a new car the day he/she receives the cheque they should come off hire immediately.
2. If an interim cheque is close to the final e.g. £3,000 cheque sent and then another £100 agreed, it would be unreasonable for the 7 days to continue until after the extra £100 is received.
3. Negotiations between an insurer and claimant on value do not usually embrace "we negotiate final payment based on whether I can realistically purchase an equivalent vehicle". It is what the vehicle was worth and not what a claimant can find when they come to seek a replacement. They could cite advertisements for similar vehicles to their own to try and support a higher claim figure but it is not what they are able to purchase as there may be no similar vehicle on the market. It would be unreasonable for the claimant to stay on hire while they wait for one to be available to check on the price!
22. Incorrect payment packs (added 28.8.07)
Q: Payment packs are being presented with insufficient information to support the hire period (e.g. no loss of use dates, old vehicle groups, incorrect charges). CHOs then insisting that penalties have started to accrue from the date of the payment pack even though it’s not properly completed. This can’t be right.
A: The GTA is clear that:
6.1 The CHO will submit a Payment Pack in support of a single payment request to the at fault driver’s insurer as soon as full documentation is available. The pack will set out all charges, with documentation and supporting evidence under an agreed covering letter (example attached, Appendix D) providing payment details.
If key information is missing or there are material errors in the Pack then the TPI should inform the CHO of these within 30 days as per para 6.4:
6.4 Insurers should check information and make any enquiries on the CHO Payment Pack within 30 days. Insurers accept it should be the rare exception, rather than the rule, that dates in the hire period validation form need to be checked with other insurers.
The dates for payments start when a correct payment pack is received.
23. Individual CHO daily hire rates (added 23.7.07)
Q: How can I find the daily hire rates for individual CHOs?
A: The GTA website (http://www.abi.org.uk/tphire/) states that the individual rates for CHOs are not listed as individual CHOs may set their rates at any level up to and including the maximum for all groups. The maximum rates are listed.
CHOs are encouraged to use the new car, taxi, private hire vehicle, motorcycle and commercial vehicle group letters/numbers in submitting invoices. This should speed up the checking of invoices as far as settlement rates are concerned as claim handlers will just need to check that the invoiced vehicle is in the correct group and the daily settlement rate is no higher than the published rate for that group. All rates shown are excluding VAT.
Q: Despite the wording of the GTA, more and more cases are being pursued when there is a real liability risk. This is creating issues with debt settlement and defeats the objective of low touch speedy settlements.
A: The GTA wording was revised in 2005 to read:
“1.3 The GTA is only intended to apply to situations where a CHO feels their customer has prospects of full recovery against an at fault driver's insurer, but in all other cases the subscribers may elect to follow the same principles, provided that they comply with the spirit and terms of the GTA, including the application of the relevant settlement rates.”
25. Like for likes (added 28.8.07)
Q: Back when the GTA began, on like for like cases that were borderline, the CHO would ring the insurer and agree the class of vehicle and the rate. This no longer happens, causing delays regarding payment at the back end. It would be better for both parties for this to be brought back in. If the CHO does not agree on older vehicles, then they should accept the reasonable rate offered by the TPI.
A: Guidance is that it is preferable always to communicate with the TPI where there is any doubt e.g. over a vehicle group, old prestige vehicle, unusual vehicle etc. The sooner this communication starts in the process the better.
26. Maximum vehicle rates (added 23.7.07)
Q: On the website for a CHO there rates are shown but they are invoicing at a higher amount.
A: The individual rates for CHOs on the website are not up to date as they have been replaced by the maximum rates on the website that apply to all first tier subscribers. A CHO can charge up to the maximum.
This is why the home page on the website states: “IMPORTANT
NOTE: New maximum car hire settlement rates w.e.f 1 April 2006 New maximum commercial vehicle hire settlement rates w.e.f 14 August 2006 New maximum private hire and taxi hire settlement rates w.e.f 14 August 2006 New maximum motorcycle settlement rates w.e.f 1 March 2007 The individual rates for CHOs are not listed as individual CHOs may set their rates at any level up to and including the maximum for all groups. CHOs are encouraged to use the new car, taxi, private hire vehicle, motorcycle and commercial vehicle group letters/numbers in submitting invoices. This should speed up the checking of invoices as far as settlement rates are concerned as claim handlers will just need to check that the invoiced vehicle is in the correct group and the daily settlement rate is no higher than the published rate for that group. All rates shown are excluding VAT. Where there is any doubt or dispute on the group of the CHO hire vehicle that applies e.g. for cars that do not appear as examples in the groups or commercial vehicles, then you can contact GTA@abi.org.uk for allocation to the appropriate group. This service is available to GTA subscribers only. You should use 'Vehicle group request' as the email subject heading, and please note that only requests using this form can be processed. The grouping process is only to be used to ascertain the group of the CHO's hire vehicle, not the claimant's pre-accident vehicle. Enquiries are usually considered by a Vehicle Group Sub-committee once/twice a month so there may be a delay in providing clarification. The historic rates and groups for individual First Tier credit hire subscribers will continue to be accessible until further notice. The details may be useful in checking old invoices but rates are not included for individual CHOs for cars after 1.04.06 or commercial vehicles and taxis/private hire after 14.08.06 or motorcycle rates after 1.03.07 as the maximum rates apply as noted above.” 27. Loss of use dates (added 28.8.07)
Q: Some insurers ask for proof of loss of use dates for every hire. Surely this is wrong?
A: Yes, it should be the rare exception, rather than the rule, that dates in the hire period validation form need to be checked with other insurers.
28. Mitigation – checking for insurer offer (added 28.8.07)
Q. Is a CHO required to check with their client that they have not received an offer for a replacement vehicle from the at-fault insurer?
A. Yes, the mitigation statement signed by the customer states:
‘Prior agreeing to enter into the hire agreement my duty to keep my losses to a minimum have been explained to me and I had not received an offer for a replacement vehicle from the at-fault insurer. OR I did receive an offer of a replacement vehicle but did not accept it because………………………………’
29. Mitigation statement (added 28.8.07)
Q: Has the wording altered since the new GTA wording was agreed in 2005?
A: Yes. The words "I have had credit hire and the cover provided by my own policy explained to me." Have been deleted so that the statement starts with the second sentence “I understand that if I choose to hire on credit.........."
30. Negotiation (added 23.7.07)
Q: We’ve tried to negotiate when we receive the first notification form on issues such as like for like. This would result in speedier payment to CHOs on presentation of the payment pack. CHOs are unwilling/not able to negotiate on these cases.
A: All insurers and CHOs are encouraged to communicate and negotiate as quickly as possible in the claim process. This must be in the best interests on both parties.
31. Non-standard drivers and additional insurance premiums (added 1.6.08)
Q; How are non-standard drivers defined?
A: An additional insurance premium may only be charged where either the hirer/driver or additional driver is considered to be a non-standard risk and would therefore normally attract a loading of insurance premium by insurers.
Examples of a non-standard risk driver would be under 25 years of age or over 70 years of age, lack of driving experience (held a full driving licence for less than 12 months), occupation (e.g. Professional sportsperson, members of the Acting or Entertainment professions, Journalist, Publicans etc), convictions resulting in an unspent ban or greater than 7 points outstanding on their licence.
32. Parts delay (added 28.8.07)
Q: We currently have a situation with one of our claims where the third party insurers will not pay the extra days hire due to a delay in repairs. The part was damaged in transit to the repairers. They had to re-order and eventually they had to source the part elsewhere. Are we in a position to claim back the extra days hire due to these delays?
A: In para 4.12 the GTA provides “When a hire has been correctly monitored and reported, insurers accept responsibility for delays resulting from lengthened hire periods. This will include insurers not disputing unavoidable delays in repair times due to unavailable parts if the correct monitoring and reporting has been carried out by the CHO.”
So if the CHO monitored corrected and reported back as required to the TPI, then the CHO is not responsible for the delay and can recover the lengthened hire.
If, however, the hire has not been correctly monitored by the CHO then para 6.15 applies:
6.15 Where there is a non deliberate breach of the GTA that results in material cost increases, insurers agree to pay GTA claims reduced only by the savings that would have been achieved or the lower costs that would have resulted had the breach not occurred. For example, if a CHOs reporting and/or monitoring falls down in some way (e.g. an insurer is not notified of increased hire due to garage delays in the repair as required in paragraph 4.11, CHOs should be paid in full but less any amount the insurer would reasonably have saved if the monitoring had been complied with fully).
33. Penalties on penalties (added 23.7.07)
Q: Some CHOs attempt to charge penalties on penalties. We make a payment in full but that isn’t received until after 30 days we then get charged penalties (7.5% ) which may not be received or dealt with for another 31 days and the CHO attempts to charge us 15% penalties on the original amount claimed.
A: The CHO is wrong. The GTA states:
6.8 Failure to settle within the period in paragraph 6.7 and subsequent one month periods will result in the following late payment additions to the total invoice: Period between dispatch of claim Late Payment Penalties to insurer and receipt of payment (total additional %) ______________________________________________________
Hire Repair If applicable Up to one calendar month None None Between one and two calendar months 7½% 2½% Between two and three calendar months 15% 5%
The percentages are not cumulative. If an insurer pays after 6 weeks the penalty is 7.5%. If they pay after 10 weeks it is 15%. If they pay after 3 months there is, in effect, just the 15% penalty unless you take the case outside the GTA and go for your commercial rates.
34. Penalty charges post 90 days (added 23.7.07)
Q: Can a CHO add another penalty charge after 90 days have elapsed if the claim has not been settled?
A: No. There is no provision for this in the GTA. After 90 days a CHO can elect to take the case out of the GTA and issue for their commercial rate.
35. Penalty interest and the Admin Fee (added 23.7.07)
Q: Can penalty interest be charged on the administration fee?
A: Yes . 36. Penalty payments when liability not challenged within 21 days (added 27.2.08) Q: Some insurers (on split liability cases) try not to pay late payment penalties when they have not challenge liability within the first 21 days submission of the payment pack, or indeed when challenged claims are eventually settled in favour of the credit hire organisation at 100%. Is this correct? A: No, see para 6.10 of the GTA.
37. Private or commercial hire (added 23.7.07) Q. My client drives a 1994 2.5 diesel Landrover Discovery. This is the only vehicle in the household and is privately owned. The vehicle is used for social and domestic purpose but also used to tow trailers and some occasional farm work as the client lives on a farm. Given the age of the vehicle I would have suggested an F1 to be a suitable replacement. However it has been suggested the client is provided with a CP2 (commercial 4X4). I disagree with this as the client’s vehicle is a privately owned vehicle and a Landrover Discovery is not classified as a commercial vehicle. Who is right? A. On the one hand your offer does seem reasonable given the age of the vehicle and the fact that his vehicle is privately owned. However, given the use to which the vehicle will be put and the fact that the farmer is used to driving an old vehicle, are you happy for him to have a near new private hire vehicle? His use seems very mixed private/'commercial'. If you did provide a commercial hire vehicle have you not got something older and more 'used' that would be suitable?
38. Repair monitoring (added 23.7.07)
Q: Surely there needs to be evidence of repair monitoring. Ringing a garage and making a note that there will be delays but not doing anything to try to bring about a quicker resolution/getting to grips with the problem. CHOs should in these cases be seeking to reduce the hire period not simply recording that there has been a delay. The information provided is often insufficient, and in a standard format that gives insufficient information to decide whether any delay is reasonable.
CHOs should acknowledge their special responsibility for the hire/repair period when they are dealing with both hire and repair, often thought their nominated network. The GTA is clear about the monitoring responsibility but if there are problems with engineer or garage then all we seem to get is the full bill and reference to “Clark v Ardington”.
Some CHOs simply don’t monitor at all.
A: There are several issues here. First, if it is just a credit hire then the CHO is required:
4.10 The CHO will monitor the hire period throughout the period of the hire: · CHOs will check with a garage that a repair has been authorised within 3 working days of the vehicle going in. · CHOs will make a further check with the garage after the lesser of 5 working days or 3 working days before the hire should have ended. · CHOs will check with the garage 3 working days before the hire should have ended.
4.11 CHOs should inform the at fault driver’s insurer in all instances where there are 'unreasonable' delays (defined as delays that are at least two working days longer than expected or over 20% more than the estimated hire period notified to the CHO) with a notification of the delay. If the repair is delayed beyond these periods then the CHO should undertake checks every 5 working days after the original hire period should have ended. Any further delays should be notified to the at fault driver’s insurer. 4.12 When a hire has been correctly monitored and reported, insurers accept responsibility for delays resulting from lengthened hire periods. This will include insurers not disputing unavoidable delays in repair times due to unavailable parts if the correct monitoring and reporting has been carried out by the CHO. Insurers accept that comprehensive repair monitoring can be more difficult and CHOs can only monitor the information they receive from garages including estimated completion dates. 4.13 In particular, providing that the CHO has correctly monitored the repair, the CHO will not be responsible and the hire period will not be reduced, if an engineer fails to liaise with the at-fault driver’s insurer if a significant delay is likely for required parts (paragraph 6.3(viii) of the Repair Protocol) or subsequently if the supply of parts is delayed (paragraph 6.2 of the Repair Protocol). Thus “Ringing a garage and making a note that there will be delays but not doing anything to try to bring about a quicker resolution/getting to grips with the problem.” Is in breach of para 4.11. Monitoring requires a report back to the at fault driver’s insurer in all instances where there are 'unreasonable' delays (defined as delays that are at least two working days longer than expected or over 20% more than the estimated hire period notified to the CHO) with a notification of the delay. The reporting back should include a reason(s) for the delay. However, as noted CHOs can only “monitor the information they receive from garages including estimated completion dates.”
Secondly, where the CHO undertakes hire and repair they are required to be even more diligent in their monitoring and reporting back. If they fail to do so, or delay inspections etc, they are responsible for any delays.
Finally, if a CHO fails to monitor then they are responsible for any delays subject to para 6.15:
6.15 Where there is a non deliberate breach of the GTA that results in material cost increases, insurers agree to pay GTA claims reduced only by the savings that would have been achieved or the lower costs that would have resulted had the breach not occurred. For example, if a CHOs reporting and/or monitoring falls down in some way (e.g. an insurer is not notified of an increased hire due to garage delays in the repair as required in paragraph 4.11) CHOs should be paid in full but less any amount the insurer would reasonably have saved if the monitoring had been complied with fully.
39. Roadworthy or not? (added 23.7.07)
Q: I have a claim where the vehicle was mobile and in use. The CHO provided a credit repair and hire service. The hire stated on the 17/05/06, vehicle was inspected 18/05/06, authorisation given 19/05/06, parts ordered 19/05/06. Parts received 23/05/06 and repairs completed that same day hire vehicle returned 24/05/06. As you can appreciate our concern here is that a one day repair effectively turned into an 8 days hire period. Can you please confirm if you believe that this is reasonable under the ABI GTA or if you are in agreement that if a vehicle is in use it should not be taken off the road until parts are available.
A: This is an example where the insurer and CHO should communicate more effectively. The key here is whether the vehicle was roadworthy. Para 4.6 states " The hire period commences when the customer both needs and takes delivery of the replacement vehicle. Where it was reasonable for the customer to believe the vehicle to be unusable and/or unroadworthy but the engineer subsequently confirms the vehicle to be usable, the hire will be paid up to the date the disagreement is resolved. 'Roadworthy' embraces 'usable and roadworthy' so as to include aspects such as deficient locks, panel damage or a need for a prestige vehicle. It is accepted that the position is different if the customer's objective seems to be to act in a wholly unreasonable manner.
40. Selectivity in implementing the GTA (added 23.7.07)
Q: I'm right in thinking a CHO can't pick and choose aren't I? They're either in or out - and can't seek additional payment for delivery/increase the daily hire rate just because the customer was in a slightly out of the way place?
A: Absolutely right. If you are first tier you must comply fully for all your hires. The same applies to an insurer as to a CHO.
41. Sub-hired vehicles (added 27.2.08)
Q: Some TPIs are searching Experian/DVLA sites for details on the hire vehicles a CHO has provided to their client. Some of these vehicles have been sub-hired from elsewhere and they don't show up as being registered to the CHO. The insurers are then stating that we have no right to raise a hire invoice for use of a vehicle that doesn't belong to us. This cannot be right?
A: It is perfectly proper for CHOs to sub-hire vehicles in order to provide a client with a suitable replacement. The payment pack information should usually be accepted as proof that the CHO has provided the vehicle in question.
42. Taxi and private hire extras (added 23.7.07)
Q: Before the new groups and rates some CHOs were charging an additional daily hire extra amount for some things e.g. £5 per day for radio hire, £5 per day for hire of signage. Can a CHO now charge for extras such as provision of taximeters and roof signs?
A: The GTA is clear that "No extra additions allowed such as for signage, radio hire, taxi display etc."
There is a problem that insurers are interpreting this as no additional costs are allowed for such hires. There are, however, additional costs that need to be met for some hires because of different Council costs for replating vehicles, fitting of different radio etc. These are actual costs that need to be paid.
43. Telephone lines (added 23.7.07)
Q: Has the Technical Committee agreed any guidance on telephone lines?
A: Yes. Premium rate telephone lines are not in the spirit of the GTA and where known changes are to take place, as much advance notice should be given to interested parties e.g. closure of a call centre, change in telephone numbers or claim centres.
44. Total loss and receipt of cheque (added 23.7.07)
Q: When does the maximum seven days start from for a hire to end for total loss claims?
A: The GTA Is clear “The hire may continue until 7 calendar days (a week) after receipt of the final settlement cheque by the customer or their representative.” It is after receipt of the payment and not when the payment is agreed by the insurer or the date they despatch payment. 45. Total losses - monitoring (added 27.2.08)
Q: CHOs are failing to notify the at fault insurer if an offer has not been made within the maximum 14 day maximum period. CHO takes the vehicle into a garage and if it is then written off passes the insured back to the insurer to deal with the third party. Insurer then takes on the claim some 2/3 weeks later and invariably insurer is landed with additional cost. What is the position?
A: A CHO is required to monitor the claim as per the GTA. For a total loss para 4.14 sets out the details. Where correct monitoring has been undertaken para 4.12 sets out the insurer’s requirement to pay. If the monitoring has fallen down in some way then para 6.15 is relevant.
46. Total loss – size of hire payment (added 27.2.08)
Q: Some insurers routinely refuse to meet credit hire claims when the total exceeds the pre-accident value of the vehicle. There is no justification or explanation given for their stance. Is this correct?
A: The size of the claim has no bearing so long so long as the GTA requirements have been met.
47. Unlimited Mileage (added 23.7.07)
Q: Do GTA rates include unlimited mileage?
A: Yes.
Q: Do the daily settlement rates include or exclude VAT?
A: They exclude VAT.
49. Vehicle group dispute (added 23.7.07)
Q: What happens if there is a dispute about a hire vehicle group that is not listed as an example in the tables?
A: Where there is any doubt or dispute on the group of the CHO hire vehicle that applies e.g. for cars that do not appear as examples in the groups or commercial vehicles, then you can contact GTA@abi.org.uk for allocation to the appropriate group.
This service is available to GTA subscribers only. You should use 'Vehicle group request' as the email subject heading, and please note that only requests using this form can be processed.
The grouping process is only to be used to ascertain the group of the CHO's hire vehicle, not the claimant's pre-accident vehicle. Enquiries are usually considered by a Vehicle Group Sub-committee once/twice a month so there may be a delay in providing clarification.
CREDIT REPAIR AGREEMENT EXTENSION
50. Credit repair protocol – application (added 27.2.08)
Q: If an insurer does not support the credit repair protocol can they maintain that they still benefit from its provisions and CHOs must abide by the standards, timetables and procedures set down?
A: No, this is a matter for the CHO to decide upon. They are under no obligation, other than to mitigate the loss.
51. Credit repair - Fraud checks and repair authorization (added 1.6.08)
Q: Can a CHO delay credit repair authorization of repairs in order to undertake further enquiries?
A: For credit repairs the agreement requires under Option 2 (Independent Repairer) that the “engineer will normally authorize the repair at the time of inspection” and issues like fraud checks should not delay authorization.
52. Credit repair – monitoring (added 27.2.08)
Q: We are raising issues within the confines of the GTA – engineer hasn’t inspected within required time frame for example. The CHO just won’t accept our shortfall in hire period and just lets claim moves into commercial rates notwithstanding the clear GTA breach.
A: The GTA is clear in that para 4.12 states “When a hire has been correctly monitored and reported, insurers accept responsibility for delays resulting from lengthened hire periods.” The converse is also true i.e. where a hire has not been correctly monitored and reported the CHO is responsible for any delays.
53. Credit repair – roadworthy vehicles (added 27.2.08)
Q: Where a vehicle is roadworthy there are some CHOs that book the car in the repairers and only then instruct an engineer when the car is in the garage. The engineer then takes 48 hours to inspect and this has the effect of adding a further 3 days to the hire period. Surely this procedure is wrong if the subscribers both support the credit repair extension?
A: The procedure should be
to mitigate the hire period and instruct an engineer
54. Credit repair – 66% rule (added 27.2.08)
Q: What happens when the 66% rule regarding damaged vehicles is not being adhered to?
A: The repair extension requires the CHO to advise the at fault driver’s insurer within one working day of receipt of the independent engineer’s report when a vehicle is a total loss or repair costs exceed 66% of the pre-accident value. The report must be faxed/e-mailed by the CHO to the at fault driver’s insurer
Failure to adhere to the 66% rule is a breach of the engineer’s service standards. The TPI and CHO should liaise so the engineer is made aware of any error. If it is repeated it should be suggested that the CHO discontinue using the engineer in question. GTA Technical Committee |
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