APPENDIX E

ABI GENERAL TERMS OF AGREEMENT - CREDIT REPAIR AGREEMENT

1INTRODUCTION
1.1This repair protocol is intended to operate where a customer does not have the benefit of comprehensive cover on their own vehicle or by agreement with the fault insurer.
1.2If a request comes from a comprehensively insured claimant, he/she must be given the full facts and choices which are available.
1.3The CHO must advise customers of their duty to mitigate their loss and their ultimate responsibility for payment of the repair account in accordance with the credit organisation’s contract terms and conditions.
1.4The customer may choose either:

OPTION 1
1.5The “at-fault” insurer’s approved repairer network and receive the benefit of the terms and conditions offered by that repairer as though they were an insured (ex courtesy cars) unless agreed otherwise.

Or

OPTION 2
1.6An independent repairer of their choice subject to an independent engineer – or, if elected by the insurer, an insurer nominated engineer - being
  1. Satisfied that the chosen repairer has the skill and equipment to undertake the work

    and

  2. able to agree repair terms that satisfy the requirements of this Agreement
2GLOSSARY OF TERMS
 Independent Engineer
2.1The inspecting engineer will be a corporate or associate member of the Institute of Automotive Engineers Assessors (or working towards such membership) operating to agreed service standards, who was selected under Option 2.

The CHO will have no financial interest/connection with the independent engineer.

Independent Repairer
2.2bodyshop nominated by the CHO or the vehicle owner who will undertake the necessary vehicle repair on the terms specified by the independent engineer.
Repair Option
2.3Option 1 or 2 as detailed above.

Payment Pack
2.4Documentation submitted to the “at fault” insurer in support of claim being submitted. Full details are contained in the payment procedure section of the ABI’s General Terms of Agreement for replacement vehicles (credit hire Agreement).
3OPERATING PROCEDURES
3.1Immediately the CHO identify the “at fault” insurer as a subscriber to this scheme they must notify them in accordance with the insurer’s specified procedure (see Appendix A to the GTA for specimen New Claim Advice Form which covers hire, repair and personal injury). In the absence of a reasonable explanation for failure to notify the insurer immediately, the insurer will not be liable for storage/hire charges incurred before the notice was given. This notification will indicate which repair option is required.

  1. Option 1 Procedure (Insurer’s Approved Repairer)

    1. Insurer will respond within 2 working days of receipt of the New Claim Advice Form and ensure that an early decision will be given on liability. Subject to acceptance the insurer will nominate their chosen repairer(s) and vehicle inspection arrangements.

    2. CHO will promptly advise their customer and liaise with nominated repairer to arrange vehicle inspection and repair (Appendix E1 for specimen instruction letter)

    3. Vehicle inspection will be in accordance with insurer’s requirement (ie in-house engineer or independent) and will be detailed by insurer when repairer is nominated,

    4. Repair authorisation will be deemed to be by vehicle owner, with repair account direct to “at fault” insurer supported by standard satisfaction note (a copy of which will be provided to CHO to support hire period).

    5. CHO will liaise with repairer to identify repair completion date but responsibility for minimising repair period remains with insurer.

    6. On completion of repair appropriate account submitted to “at fault” insurer (see payment procedure)

    7. Any complaints relating to the repair will be handled by the insurer as though complainant were a policyholder.

  2. Option 2 Procedure (Independent Repairer)

    1. When reporting a claim to the “at fault” insurer, the CHO will also, depending on the insurer’s elected preference, either:

      - instruct an independent engineer (within 24 hours of the customer electing option 2) to inspect the vehicle (Note: the insurer agrees to pay the engineer’s fee of up to £50 plus VAT irrespective of policy liability, or
      - advise the insurer to arrange the vehicle inspection by a staff engineer (or insurer nominated engineer)

      In the circumstances when the insurer has elected the latter option, the insurer will not dispute an elongated hire claim which has resulted from its failure to arrange the inspection promptly. The insurer will be responsible for monitoring the repair process. The staff/insurer-nominated engineer inspection should be carried out within the same period as set out in 6.3 (i) below.

    2. CHO will recover damaged vehicle to repairer in vicinity of the damaged vehicle to minimise recovery charges. Repairer will not charge storage charges where vehicle repaired.

    3. The engineer will normally authorise the repair at the time of inspection.

    4. CHO will monitor repair period to ensure repairs completed within timescale agreed by independent engineer. (Note: Initial authorisation to independent repairer requires them to advise independent engineer if repair is likely to exceed period initially agreed). The at-fault insurer will not accept liability for hire period beyond the repair period agreed by the independent engineer

    5. On completion of repair, the independent repairer will submit the repair account, together with the customer satisfaction note either:

      - direct to the CHO, if the account tallies with the agreed estimate, or

      - to the engineer if the account and the estimate do not tally

    6. Any complaints regarding repair are the sole responsibility of the CHO (who may involve an independent engineer) without recourse to “at fault” insurer.

    7. The CHO will advise the at-fault 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 pre-accident value or there is likely to be a significant delay in delivery of required parts. The report must be faxed/e-mailed to the at-fault insurer.
4INDEPENDENT ENGINEERS AUDIT – (Option 2 claims only)
4.1The initial claim advice submitted by the CHO will identify the independent engineer who has been instructed and the location of the damaged vehicle. At the discretion of the “at fault” insurer they may arrange their own inspection of the damaged vehicle to validate the costs involved. Any adverse findings from such an inspection will be shared with the CHO but will not affect payments to be made to them unless they or their nominated repairer are shown to be implicated or are in breach of the terms of this protocol.
4.2If an insurer is not happy with the performance of an independent engineer it can, on provision of evidence of the engineer’s shortcomings, require the CHO to stop using the engineer in the future. In the event that an insurer discovers evidence of fraud all CHOs who are signatories to this Agreement should be instructed to stop using the engineer and the IAEA will be asked to investigate the matter and review the engineer’s membership of the Institute.
55 PAYMENT PROCEDURE/ADMINISTRATION FEE (this section should be read in conjunction with similar section in GTA)
5.1The insurer will pay the CHO an administration fee of £30, plus VAT. If the CHO has also arranged a credit hire then a combined fee of £50 plus VAT is payable. (These fees will only apply when the customer retains responsibility for payment of the repair/hire charges.) If Option 1 is chosen the insurer will pay the £30/£50 administration fee as appropriate.
6INDEPENDENT ENGINEER SERVICE STANDARDS
6.1Engineers will operate to the following Service Standards and exercise impartial independent judgement as though operating as an independent expert responsible to the Court. They will receive instructions from the CHO but these should be considered to be jointly from the “at fault” insurer who in turn agrees to pay the fee (max £50 + VAT). The engineer’s report will not normally be supplied to the insurer until the invoicing stage; however, individual insurers can request the report when it is first available.
6.2The engineer should liaise with the “at fault” insurer if the supply of parts is delayed as they may have facilities to assist.
6.3The Service Standards are

  1. Vehicle to be inspected within 2 working days of instruction and report submitted by e-mail/fax to instructing CHO within 1 working day of inspection
  2. Vehicle repair time to be based on “Thatcham” times or an agreed computer estimating program if available
  3. Hourly labour rate to be “A reasonable and appropriate figure based on geographic location and bodyshop facilities”
  4. The engineer will ensure that all standard market discounts and commissions are passed on to the insurer, including labour, parts, paint and materials and engineer’s fee
  5. Engineer’s report will record instruction date
  6. Repair period (including parts delivery if vehicle unroadworthy) to be agreed with bodyshop at time of vehicle inspection
  7. Engineer’s report to identify whether damaged vehicle roadworthy (including consideration of temporary repairs) plus
    Number of repair hours agreed
    Hourly rate agreed
    Repair period agreed
  8. Total loss valuations to be based on appropriate vehicle guides and local knowledge
  9. Engineer’s report to identify where repair cost exceeds 66% of vehicle value or significant delay likely for required parts
  10. Bodyshop to liaise with engineer in event of parts delay or additional work being required. Where required, any follow-up inspection and revised report issued within 3 working days of notification
  11. Repair account checked and submitted to CHO within 2 working days
  12. Engineer agrees to and will co-operate with “at fault” insurer audit programme


< Back to General Terms of Agreement