Articles of Interest
BBC Watchdog - Direct Line Watchdog Transcript November 2003
Like all big car insurers Direct Line arranges for damaged cars to be fixed at approved repairers. Trouble is a growing number of you don’t approve of these garages. As Kate discovered.
There are almost a ¼ million car accidents in the UK every year. That’s why you pay your car insurance. You want to know if the worst happens you and your wheels are protected. And that’s the appeal of Britain’s biggest car insurer, Direct Line.
But Donna Taylor’s car came out of a Direct Line approved garage in quite a state.
“When I drove it, I knew it felt different to when I’d driven it before the accident. It was juddering; the engine was making a grinding noise; the tracking was obviously out. I’m not an expert but I could tell that. And when I steered to the right it felt as if the car was going to shake to pieces. I took the car to a local garage and there was a string of faults with it.”
I’ll say. The engine had been pushed out of line, the steering was vibrating and one wheel was catching on the wishbone on the lock.
Which doesn’t sound very lucky to me. The right hand tyre was virtually bald because of the pressure being put on it. In fact the garage said Donna’s car shouldn’t even be on the road.
“I’d taken neighbours out, I’d taken my children out, I’d taken my husband out and not only had I put all those people at risk, I’d put other road users as well. Try driving round in this terrible car. When you actually open the bonnet up inside you could see the impact that the other car had made to the inside of the engine. There were cracks and dents there and they’d filled it in with polyfilla.”
Though Direct Line acknowledged Donna’s car was unroadworthy, they said this was not indicative of the normal standard they give.
But Carol McAllen had a problem with Direct Line approved garage after she’d had a car crash this summer.
“I contacted Direct Line who took my claim in over the helpline and told me one of the approved garages would contact me to make arrangements to get my repair done.”
Carol was pleased to get her car back two weeks later because being without it was driving her round the bend. And she took it with confidence for its MOT but it failed. On precisely the bodywork and welding repairs carried out by Direct Line’s approved garage.
“I was extremely disappointed that my car failed the MOT. I cannot understand how Direct Line could let that happen.”
How indeed? Direct Line sent Carol’s car back to the approved garage for the work to be done. It then went back to the MOT examiner.
“He couldn’t tell for definite whether the work had been done again, because they put so much sealant over the actual part they were meant to have welded.”
Later Carol’s car was back in the garage needing more repair work.
At least this time it was garage of her choice.
So that’s two approved Direct Line garages that haven’t come up to scratch.
But what about Direct Line’s own accident repair centres? Surely you’ll get better treatment there?
This man worked at one of these sites. He was appalled at some of the states some cars were in when returned to their customers.
“Direct Line were definitely sending cars out when they knew they’d got problems. Customers won’t always know about them because if a headlamp is falling out they’ll see it . But if the body’s twisted you’re not going to notice until something happens to highlight it.
“I think targets have got a lot to do with it. The place is run on a target. Everyone’s got an efficiency to hit or else. Wages get docked. Shifts get changed.
One car he dealt with particularly worried him.
“It came in with damage to the engine, the gearbox and all the front suspension. When it was eventually fitted up I explained to the manager it was still bent, but the management wasn’t really interested.”
Leanne had a crash in her car last October. Direct Line took it to their Birmingham site to be repaired. But Leanne knew something was wrong when she got it back.
“At the back end of the car I could hear a banging sound. It sounded like it had come from the exhaust. It just wasn’t right for this to be happening.”
“I called a local garage and asked if they’d be prepared to take a look at it. And I took it in the following day.”
Apparently the crash knocked the back end of Leanne’s car and crushed the exhaust in the middle. When Direct Line’s garage fitted the new part of the exhaust to the back, they failed to bolt it together properly.
Leanne’s garage said the car was unsafe to drive.
“It made me feel physically sick. I’d been driving round in the car with small children and it wasn’t roadworthy.”
Leanne had to wait another 4 weeks for Direct Line to send an engineer out to look at her car. It was finally fixed properly by her local garage.
So when you hear that rallying call and take in your wrecked car, make sure you don’t get a wrecked car back.
Direct Line say they do take every complaint extremely seriously. Unfortunately in the three cars highlighted by us their normally high standards had fallen well below expectations. They seriously regret the inconvenience, and frustration experienced by our trio, but claim all have now been resolved to these customers’ satisfaction.
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From Last Week’s Sunday Mirror - By Quentin Willson
DIANAH Hargrave, emailed me about the new Kia Sedona she bought in June 2001. In February 2003 it was damaged in an accident. The car was repaired at a local garage approved by her insurance company. When she collected it she found the airbag warning light was on and the horn wouldn’t work. The car was returned to the repair centre who found that the main wiring loom was damaged, so they sent it to the local Kia dealership. Nearly six months on and Dianah still hasn’t got her Sedona back. First she was told no part was available in the UK, so they had to send abroad. Then the bodyshop man knew of a local electronics expert who could make a new wiring loom. He made the loom but it was not compatible with the new airbags. So they sent away for new bags, but one of those was faulty. Dianah contacted Kia Customer Care… who offered her a pounds 50 valet as compensation. She then wrote to Paul Williams, managing director of Kia Motors UK, asking for his help. He has passed the matter back to Customer Care.
QUENTIN Says: This is one of the worst cases of buck-passing I’ve ever come across. Two large companies have rendered Dianah’s car both unsafe and illegal to drive. Because of their collective incompetence, her Kia has been immobile for six months. The insurance company should have repaired the car to a roadworthy condition and they clearly haven’t They are therefore in breach of contract. Kia should by law keep enough spare in the UK to keep their products running. Obviously they don’t. Worse still, neither organisation seems to give a damn about their customers. I’d stop being nice and consult a solicitor.
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The Judge: Tesco Loses Va Va Voom - Supermarket Giant takes three months and £4500 to repair Kara’s Renault Clio
Teenager Kara Myles got the shock of her life when she crashed her dad’s Renault Clio. But she was even more upset when insurer Tesco left them with a vehicle they couldn’t drive.
The firm – which had just announced record profits of £908 million-paid £2500 for repairs to the bodywork of the car following the bump in June.
But they insisted a further £2000 worth of damage to the engine was a mechanical fault that had existed before the smash and was not covered by the policy.
Kara, 19 said “I have been off the road for nearly three months and Tesco don’t care. We’ve reached a stalemate, as the situation has got completely out of hand. Please help”.
Kara, a check-in clerk at Edinburgh Airport, bumped the car at nearby Newbridge roundabout in June. She said: “I was quite shaken up as I had only recently passed my test”.
The motor was towed away within an hour by a recovery company – on the instructions of the police – because of high security for the G8 Summit at Gleneagles the following week.
Kara’s dad Terry, 44, an electrical engineer, called Tesco to report the accident. He had taken out the insurance policy when he bought the car and listed Kara as a named driver.
Kara, of North Queensferry, Fife, said: “The car had been towed to a local garage. Tesco sent an inspector along, who estimated the bodywork repairs would cost around £2500. It needed two new wings, a bonnet, a radiator and a fan”.
As the car was valued at around £3500, Kara and her dad expected the insurance company to write the vehicle off….but they didn’t.
She said: “For some reason they decided the repairs should go ahead. I thought it strange, given the cost of the work in relation to the value of the car, but that’s what they did.”
The vehicle took two months to repair and Kara and her dad were left with no transport. She said: “The policy dad took out does not provide a courtesy car so I had to rely on lifts. The early shift at work starts at 4.30am so I wasn’t exactly popular.”
Finally they received a call to say the car was ready for collection.
Kara said: “I was so excited and desperate to get back on the road”.
But the Clio wouldn’t start. Kara went on: “The battery was flat and, when dad went to jump-start it, he noticed there was no belt on the alternator. The pulley on the alternator was also shattered and damaged. It was certainly not ready to be driven off”.
When the finally got the car started, there was a loud noise from the engine. Terry contacted Tesco, who sent out an engineer.
Kara said: “He checked the damaged engine and said the noise must have been there before the crash – which was a lot of nonsense”.
Terry called an independent engineer, who drew up a report costing £200.
Kara said: “The engineer said he was 110 per cent sure the damage had been caused by the bump to the front end of the engine”. But still Tesco refused to pay up. Kara said: “I’ve had the garage on the phone saying that if we don’t pay the £550 excess and tow the car away, they are going to charge £12 a day for storing it. I don’t know what to do.”
The Judge: I got on to Tesco Personal Finance – a subsidiary of the Royal Bank of Scotland – who immediately authorised the repairs and offered a courtesy car. They also paid for the cost of the engineer’s report.
They said: ”On reviewing the details of the case, it would appear that, unfortunately, we have not provided the high level of customer service expected. We have spoken to the policyholder, who is happy with the steps we have taken to bring the matter to a satisfactory conclusion. Rest assured that this customer’s experience has been raised to the highest level in our insurance centre”.
Delighted Kara and her dad are now back in the driving seat.
She told me: “I can’t thank you enough”.
I am glad I checked out Tesco and got them back on the right road.
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Wheel Life - Bang to Rights?
Earlier this month our columnist John Whitmore opened his postbag to find a pile of letters from readers complaining about the accident repair and car insurance industries. Shaun O’Reilly, a campaigner for the body repair industry, responds to some of the criticisms.
Sir John Whitmore is quite right to raise the issue of accident repairs and the widespread dissatisfaction with motor insurers (Motoring August 6). Actually your readers have barely touched the underlying causes of these issues in their responses.
Bric is a campaign group working towards rectifying the car-accident repair market, which neither satisfies consumers nor allows repairers adequate returns. The system does, however, meet the needs of some insurers very nicely, thank you.
This is not just a case of a few bad apples (insurers or repairers) spoiling the barrel; the entire market is now in a dreadful condition and not working in consumers’ interests. We think it is dysfunctional.
Fundamentally, the accident-repair market is not “free”, where consumers can choose the repairer they want. About 75% of all repairs following car accidents are controlled by insurers through their call centres. They send policyholders’ cars for repairs to networks of “approved” garages that they have selected. This enables insurers to dictate the level, quality and cost of service to be provided to their own customers. This is the hidden price consumers pay for their competitive insurance quotes. In addition, services offered by insurers (such as courtesy cars) have most often to be provided free of charge by the repair trade as a condition of being on the network.
Consumers might think that insurance company “approval” means that repair shops have the correct skills and equipment to undertake proper and safe repairs. While it is true that repairers have to get the right tick in the box before selection, little of that information pertains to their technical skills and equipment. This is simply not good enough in a world where cars and repair equipment are becoming ever more complex.
Insurance companies also direct customers into their own approved networks by steering claimants clear of body shops outside their own networks. Your readers will doubtless be familiar with the phrases used to persuade car owners to allow the insurer to do this: “The garage is not approved”, “the garage may not offer a courtesy car”, “it will take longer”. Last month we learned of one insurer who had claimed it was in dispute with a repairer, implying that the consumer should not use the garage because of a quality issue. In fact, the repairer was suing the insurer for its failure to pay for previous work.
The demands imposed on repairers are severe: free courtesy car, free valet and free collection and delivery within, in some cases, up to 40 miles. Labour rates are as much as two thirds lower than those charged for servicing of cars in the open market. On top of that, insurers demand large discounts from repairers and it takes on average 47 days before bills are settled.
To cap it all, many estimating systems mandated by insurers on their repairer “partners” are seen as suspect, often with questionable data and in some cases failing even to supply estimates with what exactly is included in a quote. No crash-repair estimating system in the UK market today has passed an independent audit.
The whole essence of the insurance “approval” system is one that seeks to minimise costs to insurers, not to maintain quality, safety and integrity of repairs, or value for money for customers.
Take the issue of cosmetic repairs raised by your readers. There is no excuse for any repairer to charge excessively for cosmetic repairs, but the system does sometimes lead to this. If you, as a repairer, have been told to collect a car on a transporter and find that, once it is back in your workshop, all the car requires is a cosmetic repair of £50, what would you do? Do you call in a cosmetic repairer to do the job and get nothing for your efforts in getting the car to the workshop and assess the damage? It is a problem that could so easily be solved if repairers were rewarded for collection, delivery and assessment. Insurers, however, will not consider this and their customers are missing out. It is also important to point out the difference between a mobile cosmetic repairer who applies undoubted skills and a few special tools to the job and a fully equipped body repair workshop. In reality, comparing the work undertaken by cosmetic specialists and car accident repairers is like comparing apples and pears; perhaps the difference is less than clear to consumers.
We have published research showing that barely 20 per cent of all UK repairers are equipped with the right welding equipment for Ultra High Strength Steels, which have been used on new cars since 2002. Failure to use the right equipment results in a convincing-looking but unsafe weld, yet our enquiries turned up only a handful of insurers who have bothered to find out if their “approved” repairers are so equipped.
Yes, you can certainly blame the garage for its failure to have the right equipment, but it is fair to point out that the continual pressure on prices, costs and output from insurers means most repairers are in “survival mode” with new kit the last thing on their minds. In a recent survey of 1000 UK car body repairers, their average return on sales, after tax, is 0.6 per cent. This return does not allow reinvestment in new equipment.
Readers are absolutely right to point out the fraud that takes place in this industry, but we question if this is so widespread. The advantages of fitting “non-genuine” parts are not quite so clear-cut as some make out. These usually take longer to source and fit and labour is usually the biggest cost in this industry. Besides, it’s often insurers themselves who specify that “non-genuine” replacement parts should be fitted to cars more than three years old. Policyholders should read the small print that allows them to do this.
Sir John is also correct to advise readers to go to the right type of cosmetic repairer for those little dents, but bear in mind that they cannot deal with crash repairs where metal has to be cut away and pulled, new panels introduced, radiators replaced and steering geometry realigned. These are the areas that can only be tackled by car body repairers. Both sorts of specialist are needed.
Bric deplores improper and fraudulent behaviour by garages. Sadly we can’t see the problem getting much better quickly, as working with trade associations and taking on the damaging practices of the insurance companies is seen as an impossible task by most repairers and very damaging to their businesses.
And the trade associations are hardly blameless, since they have utterly failed either to support their own membership or to police the market. They see members more as a source of revenue than businesses they should represent. One trade association even persuaded an insurer to require membership for repairers on its network, yet its standards continued to fall.
And into this unholy mess we have the Office of Fair Trading (OFT) with its voluntary codes of conduct complete with OFT stickers. We wonder what good this will do in an industry where consumers have virtually no say in who does their repairs and cowboys don’t join voluntary schemes: this OFT initiative is a charade.
More realistic is the recent report from the National Consumer Council that at least raises the debate about how the dynamics of the car body repair market could be improved. The key is the involvement of motor insurers and until they come into the debate, so their own role can be better understood, nothing much is going to improve. Certainly, the public is entitled to see insurers take a lead with good behaviour rather than continue with piratical cost cutting.
You are quite wrong, however, to suggest that the knock-for-knock agreements between insurers have any effect on the market. This arrangement was terminated over a decade ago and replaced with the Memorandum of Understanding. We requested a copy from the Association of British Insurers last month, but we are told it is not available and “under review”. Clearly, behind the scenes, changes are taking place, yet the consumer appears not to be represented in the debate.
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The Vehicle Builders & Repairers Association
The VBRA is warning insurers not to restrict customer choice for body repairs and threatening to report any who transgress to the Office of Fair Trading.
In an overnight fax to members, the VBRA says:
Following continuing criticism from vehicle body repairers that insurers were unfairly restricting customers of their right to select a vehicle body repairer of their choice by lack of information and use of undue pressure in persuading them to use only their own approved repairer network when policyholders are talking to help lines and other insurer staff. By operating such practices it is felt that this can disadvantage both the customer and have a detrimental effect on the relationship between the customer and the vehicle body repairer and is in conflict with the OFT’s recommendations that customers should be informed that they do have the right to select a repairer of their choice.
To clarify the situation with each insurer on this matter, the VBRA has conducted, and is continuing to conduct a survey asking insurers to confirm that in practice they do inform their policyholders that they have the right to select a repairer of their choice when making a claim and in contact with the helpline/call centres and other staff is also made clear. To date the insurers that have provided us with a statement to this effect are listed below.
Any insurer not listed have either made contact but still have to satisfactorily clarify and confirm their policy or have not yet responded and are being followed up. When further information becomes available, it will be passed to members and where insurers are not compliant this information will be passed to the OFT.
It is essential that members inform and give details to the VBRA if any insurer, including the ones listed, continue to unfairly pressurise and put obstacles in the way to delay the start of repair in an effort to persuade the customer to allow the vehicle to be taken to another repairer. Such information and practices in turn will be passed on to both the insurer involved and the OFT.
Up to the date of this information, the insurers that have responded and have stated that policyholders have such information and are offered the right to select a repairer of their choice are:
- Amlin Insurance Services
- Axa Insurance
- Broker Direct
- CIS Co-operative Insurance
- Corinthian Insurance
- Ecclesiastical Insurance Group
- Esure
- Fortis Insurance Ltd
- Groupama Insurances
- Hastings Insurance Services Ltd
- Kwik Fit Insurance
- NFU Mutual
- Norwich Union Insurance Ltd
- Provident Insurance plc
- Royal Sun Alliance Insurance
- St Pauls International Insurance Co Ltd
- Sabre Insurance
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