How do credit hire claims arise?
Sometimes an insurance company will not accept liability for an accident, and they will refuse to pay the cost of a credit hire vehicle. If that happens, the person who hired the car (the Claimant) could be responsible for the bill. That is because they have signed and accepted the terms of the credit hire agreement.
Before you hire a car, it is very important to check that the insurance company does accept liability.
There is also another potential pitfall. The at-fault insurer might argue that the vehicle hired was a higher specification than the Claimant’s car (for example, they hired a BMW when their usual car is a Renault Twingo). In this case, they might only meet part of the cost of hire.
It may also be asserted that the hire charge fees are excessive, or you did not need to hire a car as your vehicle was still driveable, or you took out the hire for a longer period than necessary, so you failed to mitigate your loss.
Always check that the car you are hiring is similar in value and specification to your own car. In addition, the level of hire fees is not excessive, and you can justify the length of hire as being reasonable.
How else can you protect your interests?
Our solicitors at Davisons Law settle most credit hire cases without going to court. In the unlikely event your claim does reach court, the Judge will expect you to have ‘mitigated your loss’. That means you need to show that you have done what you can to keep the losses you have suffered as a result of the accident to a minimum.
Hiring a like-for-like car to keep costs down and ringing the garage to chase up repairs once a week to speed up the repairs process are examples of mitigating loss. Whether your claim goes to court or not, if your solicitor can show that you have made every effort to mitigate your losses, this makes your case stronger.
In credit hire case law, the case-law example of Copley v Lawn shows the importance of mitigating loss. Mrs Copley, the Claimant, did not take up the offer of a free replacement vehicle from the Defendant’s insurance company. Mrs Copley was already using a hire vehicle when the letter from the Defendant’s insurance company arrived offering her a free car, which is why she did not take up the offer.
However, when Mrs Copley tried to claim the cost for 71 days of hire whilst her vehicle was repaired, the Judge only allowed her to claim seven days of hire. He decided that Mrs Copley should have cancelled the expensive credit hire agreement when she was offered a free replacement car.