Beware the hire car scam

Beware the hire car scam

I received the following email from a broker this morning;

Hi Allan,       

Hope your well and keep the blogs coming. I thought this may be something that you may find interesting.  

Please find attached a notice of Intention to sue that was sent to my friend.

I think there maybe something wrong with the whole situation. To put you in the picture my friend had a fender bender at mermaid waters on the Gold Coast.

Her Insurance company [name withheld] deduced from the account of the facts of the accident that she was at fault.

They fixed her car and the damages to the other party and charged her the appropriate excess.

Then she received this in the Mail.

Your thoughts will be most appreciated.

Cheers and thanks

Best regards

Keith [surname and email provided]

The letter from an investigator known for all the wrong reasons and a lawyer in the same ill is claiming nearly $60,000 in hire charges at the rate of $600 per day.

This is a scam that I have written about before and I had shared all I knew of it with the Insured’s insurer sometime ago. They have a task force in place to address the rip off which of course is effecting the pricing of motor insurance.

I also know that a motor assessing firm in Sydney who I rate as the best at their craft in Australia has taken the issue on a number of times and shown the Courts just what this is and have won against them causing the scammers to have to pay costs.

It is only be standing up to the scammers that we can get them out of the picture for they are causing immense stress and drawing a lot of resources to the insurance industry. I feel terrible for those without insurance who receive such letters.

The scam also involves some panel beaters who offer a ‘free’ hire car for the repair and then come back and hit you with similar charges holding the car as collateral.

When I have gone to the panel beater to try and resolve the issue I am confronted with bikie body guards.

Two bits of advice. 1. Do not drive on the road without Compulsory Third Party (“CTP”) and Comprehensive Motor Insurance. If you cannot afford Comprehensive get Third Party Property Damage cover. This is different from CTP. Search in the field above for a previous article if you do not understand the important differences.

2. I am a big believer in all cars being fitted with dash cameras. I think they should be back and front. I only noticed yesterday skimming through some junk mail while waiting for a coffee that Aldi have dash cams for sale this week. This may be a great investment, but understand I have not tested the product.

One response to “Beware the hire car scam”

  1. Alex Damon says:

    Yes I’v e confronted this before…a BMW at $460/day for 2 weeks billed to a restaurant client whose sunshade blew onto a parked car and scratched 2 panels.

    On the other hand, underwriters often don’t do enough on hire care cover to ensure the client gets what they expect. For instance, a client recently had a TPAF claim on their $130k vehicle which was going to be in the panel shop for 10 days. There was $80/day hire car cover in their policy and I was told by the claims handler that he would arrange a hire vehicle as close as possible to equivalent, but when the hire company contacted the client they were offered a Toyota Yaris (no offence – my wife drives one and it’s a great car, but not prestige!) When i checked the hire company website, the client could have a substantially larger vehicle for the coverage.

    So, clearly, underwriters will want to get out of things as cheaply as possible whatever cover they offer under their policy; why wouldn’t clients be tempted by these parasitic companies who offer them a prestige vehicle?

    PS I never dreamt, starting my first insurance job in 1975, that one day I’d work my way up to arranging bookings for hire cars!

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