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                                             Hotline

Insurers Hotline Pty Ltd
PO Box 342
Toowong Qld 4066
ABN 61 003 617 909, AFS Licence 241411
12 October 2007

Mr Gordon Clement
28 XXXXXX
MT GRAVATT QLD 4122

Dear Mr Clement

Claim Number:                           111393XXX-01
Date of Loss:                             20 March 2007
Vehicle:                                     2005 Toyota Camry Sportivo (XX6 IMX)
Policy Commenced:                   26 February 2007 (Term 2)

I refer to our letter of acknowledgement of 3 October 2007 and would like to confirm that I have reviewed the handling of Ms M B's motor vehicle claim. Our office hopes this letter finds Ms B in good health following her accident on 20 March 2007.

In reviewing your correspondence of 30 September 2007 Insurer's Hotline has noted your concern over the timeframe to settlement of Ms B's motor claim. I have included a timeline of events below for your review. All timeframes are in business days.



The first matter you have raised now appears to be no longer a live issue but concerned Insurer's Hotline's offer of settlement of 17 August 2007. You assert that Insurer's Hotline varied its offer of $25,133.00.This is incorrect. Despite the
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settlement cheque stating banking of the cheque constituted full and final settlement, Insurer's Hotline's final offer has always been $25,133.00.
To date Ms B has presented two cheques totalling $25,133.00. This confirms our initial settlement offer. Ms B presented the first cheque in the amount of $24,733.00 on 24 August 2007 and the second of $400.00, presented 5 October 2007.
The amount of $400.00 was retained by Insurer's Hotline until liability was finally determined. It is noted you are of the view that this amounted to Insurer's Hotline varying its original offer of settlement. However, the original offer of settlement has always been subject to Ms B's policy excess.
The contract of insurance makes clear that Insurer's Hotline is entitled to Ms B's policy excess until such time liability has finally been determined. As late as 11 September 2007 the third party insurer, RACQ, was still disputing liability. This is why Ms B was sent a `sketch and description letter' so late. I now refer you to the policy wording:

MAKING A CLAIM
Excess payable on claims
· Payment of an excess helps to reduce the number of small claims and keep down your insurance
   premiums.
· An excess is the first amount you may have to contribute towards the cost of any claim.
· The total excess you may have to contribute to a claim is the sum of the Basic Excess and all of the
   Additional Excesses which apply and are shown in Part B and on your Insurance Certificate

You do not have to pay any excess if the car is involved in a no fault accident with another vehicle and the amount of your claim is more than the basic excess.

(Product Disclosure Statement - Part A - Page 9)
DEFINITIONS - THE MEANING OF CERTAIN WORDS USED IN THIS POLICY
No Fault Accident - if we decide the driver of the other vehicle was entirely at fault, and you tell us the name and residential address of the other driver, along with the registration number of the other vehicle
(Product Disclosure Statement- Part A -Page 1, my underlining)
In your letter to the Internal Disputes Resolution (IDR) Department you state, "... Insurer's Hotline implied fault on the part of its client in spite of having been informed on 23 July 2007 that the other party had apologised on 22 July, and admitted fault not only to Ms B and a witness, but to the police who interviewed the other party at PA Hospital'
Unfortunately, hearsay evidence is unacceptable. When dealing with a third party insurer, Insurer's Hotline cannot simply rely on the admission of fault to our client. Any statements made at the scene of an accident, including admissions of fault are also not acceptable, and any verbal statements unsupported by written evidence are of also little value.

In order to assist in determining liability Insurer's Hotline was entitled to obtain all the information requested of Ms B, including "confirmation of police report" and other claims information including her driving history.
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You further submit, "contrary to policy conditions, Insurers Hotline letter of 25 July states that an excess of $400.00 will apply to Mrs B's claim" and "her rating will be affected (future premium increase)". While the letter does say this it also says, "Please refer to you policy documents for more details." As already pointed out the policy entitles the insurer to retain the policy excess until such time as liability is determined.

It should be pointed out that you were advised during the claim lodgement conversation that you would receive a letter advising the NCD would be affected and the excess would apply. You were advised this could be ignored and would have no effect once liability was established.
In addition you refer to the Maximum No Claim Discount Protection on Budget Direct's website. You contend there has been a breach policy conditions. However Mrs B has never requested No Claim Discount Protection. I have enclosed a copy of the policy sale conversation of 20 March 2007 confirming this.

Insurer's Hotline also notes your contention that it adopted an adversarial position. In support of your position you state, "The first indication that Insurers Hotline were going to make the claim as difficult as possible came with advice by Insurers' Hotline clerk, S, that Insurers Hotline refused to accept advice of a pending claim from other than the insured.."

I have enclosed a copy the conversation between you and S on 22 July 2007. On review of the conversation there is nothing to suggest Insurer's Hotline set out with the intention "to make the claim as difficult as possible" or that the consultant "refused to accept advice of a pending claim".
What is apparent in the conversation is the claims consultant advised that in order to deal on the policy Ms B would need to give authorisation for you to do so. It is also noted that the claims consultant, S, shows the appropriate degree of compassion given the situation, and makes clear, "This [the claim] doesn't have to be lodged straight away'.

It is acknowledged when the claim was officially lodged on 25 July 2007 the consultant erroneously advised you that on receipt of third party details the policy excess could be waived and the No Claims Discount would be unaffected. A copy of that conversation is also enclosed for your reference. We refer to our explanation above in respect to this and apologise for any inconvenience this may have caused.

In reviewing this matter it is noted that settlement of Ms B's claim occurred within 21 business days of lodgement of the claim. While Insurers Hotline strives to settle claims as quickly as possible, part of the delay in this instance was attributable to negotiating a mutually agreeable settlement.
While we note your dissatisfaction with the negotiation process we respectfully reject your assertion that the offer to repair the vehicle was "used as a threat to minimise [Ms B's] claim". Any option to repair the vehicle was for the purpose of expediting settlement only. I again refer you to the policy wording:

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DEFINITIONS - THE MEANING OF CERTAIN WORDS USED IN THIS POLICY
Market Value - the reasonable cost to replace your vehicle with one of the same make, model, age and condition as your vehicle at the time of the loss or damage. It does not include any allowance for warranty, stamp duty or transfer costs.

(Product Disclosure Statement - Part A -Page 1, my underlining)
CONDITIONS OF COVER
We are entitled to:    pay for your loss or damage either by payment, repair or replacement.
(Please refer PDS, Part A, Pages 8 and 9)
Motor dealerships inflate vehicle prices to allow for additional costs such as, warranties, accessories and trade-ins. In addition the advertised price of any vehicle at a dealership is open to negotiation, particularly in the case of `cash purchases'. The advertised price is always the starting price and not a true indication of a vehicle's market value.
The prices asked for by dealerships are of limited value as they reflect the price sought rather than the price actually paid which in many respect may reflect more than a ten percent difference
In order to obtain your own market value you state it was necessary for you to drive to various dealerships over two days. However the market value could have easily been established on the Internet in a local library for example.
JC of our office discussed at length with you how the Pre-accident Market Value (PAMV) was arrived at. He also attempted to explain the disparity in dealer pricing; however, from the information to hand you were not interested in Mr C's explanation.This unfortunately also protracted settlement.
In respect of your claim for consequential losses, including car hire, we again refer you to your policy wording:
You are not covered under this Policy for:
•   financial or consequential loss such as that resulting from loss of use of the car or any personal property.
(Please refer to PDS, Part A, Page 6)
We note some of the costs you are claiming, including medical expenses would be available through Ms B's CTP Insurer. The claims consultant advised you of this during claim lodgement. In addition, RACQ has advised that some, or part of the costs, have already been reimbursed; these include car hire and bus fares. It is also noted that during the claims lodgement you were advised the policy did not provide cover for rental vehicle hire.

While the policy excludes losses of the nature claimed by you in Paragraph 8 of your letter, as a gesture of good will Insurer's Hotline is prepared to make and ex-gratia payment of $300.00 in settlement of this matter. This offer is made on the following basis:

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1. Ms B agrees that this agreement may be pleaded as a bar to any actions, claims or legal proceedings
     you may bring in respect of this claim, and
2. Ms B agrees that this agreement is not an admission of liability by Insurers Hotline or the insurer
    [Auto and General Insurance Company Limited] in respect of this claim.

This offer is made on a without prejudice basis and will lapse unless accepted within seven (7) days of the date of this letter.

To accept this offer please sign and date the enclosed copy and either,
• fax it to Insurers Hotline's Internal Dispute Resolution Department on (07) 3371 8821, or
• post it to Insurers Hotline Internal Disputes Resolution Department, PO Box 342, Toowong QLD,
   4066.

On acceptance of this offer we will forward our cheque in the amount of $300.00 to Ms B in full and final settlement of this matter.

Should you choose not to accept the offer as outlined above, you may seek the following alternative.
If your wish to obtain an independent determination of this decision, you can do so by contacting the Insurance Ombudsman Service. This is an independent service. You may contact the IOS within 3 months of this letter if you disagree with our decision. I have enclosed a copy of the brochure that explains this process.

As Insurer's Hotline has paid Ms B's claim in accordance with the terms of the polic, the IOS may find that they do not have jurisdiction in this mater. This is based on the following IOS Terms of Reference:
A Chair, Referee or Adjudicator may decide that a dispute referred to the Service shall not be determined on any of the following grounds:
-the applicant has not suffered, or will not suffer, any economic loss or other detriment of any substance as a result of the dispute.
In addition:
A Panel, Referred or Adjudicator may not determine that a member [Auto and General Insurance Company Limited] is liable to pay any punitive, exemplary, aggravated or unspecified general damages
Should you wish to discuss this further, please contact me on 07 3377 8931.

Yours sincerely

B H
Disputes Resolution Officer Insurer's Hotline
Enc.
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To accept this offer please complete the following:
Dated this ................. day of............................. 2007.
Signed.......................................
Full name...................................
Date Acceptance received ..............................(office use only)

(B 111393xxx-01)
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