Advice please re damage and insurance

[petem]

Pete, the claim is from now where the boat is damaged and could be valued as being worth less than before the damage occurred. A successful claim would lead to the necessary repairs/award of money to carry out the repairs.

That makes no sense to me! My interpretation of JFM's comments was that a claim for diminution in value is made before the repairs are carried out. But surely the dimution in value will depend on how well the repair is made (and may range from nothing to ££££)? Take gelcoat repair for example, I've seen some pretty awful ones where the boat would be worth a lot less than a good example, other gelcoat repairs are virtually undetectable and will result in very little, if any, dimution in value.

 

[benjenbav]

That makes no sense to me! My interpretation of JFM's comments was that a claim for diminution in value is made before the repairs are carried out. But surely the dimution in value will depend on how well the repair is made (and may range from nothing to ££££)? Take gelcoat repair for example, I've seen some pretty awful ones where the boat would be worth a lot less than a good example, other gelcoat repairs are virtually undetectable and will result in very little, if any, dimution in value.

Your premise is that you are claiming for a bad repair job. If the repair is done and it's done perfectly the diminution of value in the claim against the other boat owner is addressed.

'There would be a diminution in value if the repair were not done perfectly'

is about the ugliest sentence I can imagine but is what I mean.

 

[petem]

That's JFM's point (one of them): The courier company caused the problem and were liable to you for redress. They had insurance to cover them not you. The extent to which they had back-to-backed their own position is a slightly separate matter, albeit of interest largely because that would be (at least in part) where they would expect the money to come from to meet your award.

Maybe I'm miss-reading JFM's post (para 4). In the "claim for losses", is the claim for a £ amount or a claim detailing a list of losses?

 

[benjenbav]

Maybe I'm miss-reading JFM's post (para 4). In the "claim for losses", is the claim for a £ amount or a claim detailing a list of losses?

I

4. Then I'd hire my own surveyor to compile a claim of my losses and seek early payment on account to fund repairs. I would include in the claim, in this case, a diminution in value element. While you are not insured for that under your own insurance you are free to claim it from the other boat owner, and you should. He will be insured for it.
Read more at http://www.ybw.com/forums/showthrea...e-re-damage-and-insurance#trAoaglbrm4xjrZh.99

Looking at this quoted paragraph, the claim for losses is: looked at from the position today how many £££ will it take to pay for what needs to be done to put Brightside back to where he was before the incident**. Brightside doesn't have a contract with the driver of the other boat so this claim is (in tort) for money to pay for this. Brightside does have a contract with his own insurer but the terms of that are the terms of the policy and don't allow flex to cover anything not insured. The third party's insurance contract will cover third party claims successfully made against that insured (the third party).


** This would include the prospective diminution in value, i.e. if the fixed boat is not going to be worth as much as it was before the incident no matter how good the repair is. This will be quite complicated to quantify and, in a nutshell, Brightside would probably have to show that when the boat is next sold a reasonable buyer would want a price reduction against an equivalent boat that had never been damaged.

 

[benjenbav]

Your premise is that you are claiming for a bad repair job. If the repair is done and it's done perfectly the diminution of value in the claim against the other boat owner is addressed.

'There would be a diminution in value if the repair were not done perfectly'

is about the ugliest sentence I can imagine but is what I mean.

Was in a bit of a rush when I wrote the above and should have said that that's on the presumption that a perfectly repaired item is worth the same as one that hadn't been damaged in the first place, which might or might not be the case. For example, if a boat is sunk and refloated, you can do a 'Trigger's Broom' job and replace every part of it three times over but, as soon as you admit it once sank, someone's going to want a reduction.

 

[jfm]

This is an unfortunate case and as JFM states whilst reporting the incident to your insurers prepare your case in any eventuality directly against the other party.
Your own insurers in any event might appoint a surveyor dependant on cost of repairs.
One thing that has not been mentioned relates to an uninsured loss policy often offered for around £20 at time of arranging your crafts insurance. This is a specialist loss of use insurance contract with the likes of ARC legal and DAS wwho will then take up your loss of use claim against the other side.

Cheaper than a solicitor or other legal entity(sorry jfm).

A lot may depend on how pro active your own insurers are in the situation and of course if the other side are reasonable or hard ball

Not sure what you're apologising for but the stuff in yr 3rd and 4th sentences is a bit mixed up. There is no uninsured loss situation going on here.

 

[jfm]

Not boat related but a few years ago we had a claim with a courier company for some lost items. They said their insurance didn't cover the value we were claiming so they couldn't pay. We said our claim in against you not your insurance company and the Judge agreed with us.

Exactly. You've got it. Exactly as bjb says in #13

 

[jfm]

You're buying a Ferrari. Dealer has 2 in stock. Identical mileage, colour, spec, both mint. Both £400k. Car A was crashed moderately and dealer replaced a front wing, steering and suspension and painted it. All with full Ferrari warranty and all approved, and not visible from the outside (though there are witness marks/joints/welds if you know where to look). Car B doesn't have this history.

Which one will you buy if they are same price? How much will you bid lower for A if it's an open negotiation?

That's diminution in value.

Boat insurance policies for invariably exclude cover for this when a boat owner damages his own boat by accident. But brightside isn't claiming from his insurer so is not limited by that exclusion in his contract. He is claiming from the other boat owner in tort not contract and there is no exclusion of this in a tortious claim. All as said by bjb above.

The fact it is hard to quantify doesn't stop you claiming and negotiating. I know what I would claim but won't write it here in the open.

 

[jfm]

... when the boat is next sold a reasonable buyer would want a price reduction against an equivalent boat that had never been damaged.

Not the next buyer. You have to imagine hypothetical buyer buying the repaired boat now.

 

[MapisM]

I know what I would claim but won't write it here in the open.

I found all your suggestions so far crystal clear and very logic, but you are now making me curious on two levels:

1) your above statement suggests that there can be a method to determine objectively the diminution in value in this context (assuming that a 100% "as before" restoration is technically impossible, which I suspect to be the case). Otoh, I can't for the life of me think which this method can be - aside from asking (to whom?) a value appraisal, which is no Gospel truth anyway.
Or some sort of Texas shootout, maybe?

2) I'm also puzzled about your reasons for not disclosing here whatever you have in mind...
...But you know what my email is, unless you should kill me if you tell me!

 

[petem]

P, I was pondering the same two q's. Jfm, you have my email address too!

But I think jfm might have set us a test! My suggested answer would be to ask a surveyor or broker what the difference in value would be for the best example of a boat and the worst. Gut feel 20% so £50k in this case.

Another q for jfm... If you go after the other owner is their insurer automatically obliged to cover all of their costs (say under a Y policy)?

 

[benjenbav]

Not the next buyer. You have to imagine hypothetical buyer buying the repaired boat now.

Quite so. And it’s difficult to compare (to pick up MM’s point) when exact same models are rare and where there are other variables. Of the two mint Ferraris the damaged and rebuilt one might have better provenance - say, it was the Old Man’s personal runabout - which would weigh against the rebuild in desirability.

Difficult doesn’t mean that it’s impossible to value the hypothetical diminution. Just that there’s likely to be more than one credible view. In my day job I see quite a few diminution arguments in relation to the capital value of reversionary interests in buildings coming to the end of a lease-cycle. The fact that there are differing expert valuations doesn’t stop an answer being reached even if that answer is a different figure from either side’s own expert’s opinion.

 

[Brightside]

Dear All, thank you so much for your advice and comments on my current boating situation.

I am still awaiting the repair quotes and am giving serious thought as to the best way to proceed with insurers and/or the other owner.

JFM if you would be prepared to communicate via pm I would appreciate your thoughts on loss of value and my insurers.

I have really appreciated the help and support of this forums members.

Will update as matters progress.

Best wishes

 

[inception]

I presume you have a survey report or have the sight of the insurer's report? if so, you should keep this and when selling the boat consider sharing it with the buyer/buyer's surveyor as this was they won't assume the worst..

 

[Brightside]

Just to update you in case anyone interested. Estimates are coming-in. No fixed quotes, repairers wanting to examine the true damage once ashore and in part dismantled. Estimates excluding VAT (which I can't reclaim) and transport etc. are around 10% of the total value of the boat.

I have been warned the repairers want 50% upfront, so hope the insurers are agreeable to this. I don't mind if they pay the yard direct, but I want to keep the contract between me and the yard in case anything went wrong.

Thank you for the advice. I am keeping a copy of the survey report and working though my claim for additional costs - transportation, clean once back on mooring, loss of use (it is looking like I will not be back on the water until March) and the thorny issue of loss of value. I know what I would do if faced with two boats knowing one had been in a collision and one not, and also what I would seek to obtain by way of a reduction just knowing, if listed at "market price" so don't think petem you are wide of my thinking. Would appreciate others thoughts. I am not looking to make money, or gain on this, but to be back in the position I was before another vessel decided to steer into me on my mooring at sufficient speed to inflict damage.

Happy to be PM'd. And again forumites many thanks for you hep and support.