Advantage Insurance Company Limited · DRN-6096834

The complaint Mr S complains about the amount Advantage Insurance Company Limited paid him to settle a claim on his motor insurance policy after his car was declared a total loss. Reference to Advantage includes its agents. Mr S has been represented when bringing this complaint, but for ease of reading I’ll simply refer to Mr S throughout this decision. What happened Mr S held a motor insurance policy with Advantage. After he made a claim, Advantage accepted it and said his vehicle couldn’t be repaired. So, it wrote it off and paid Mr S what it considered to be the market value of his vehicle at the time of the loss - £6,500 (less deductions for the policy excess and outstanding premium). Mr S complained that settlement wasn’t enough. He didn’t think Advantage had valued his vehicle fairly and said its valuation didn’t allow him to purchase a like for like replacement. Advantage didn’t change its valuation – it thought it was fair. It said it used two valuation guides and used the average of those two to come to its valuation. Mr S didn’t agree so brought his complaint to the Financial Ombudsman Service. He thought it should pay him an amount in line with the highest guide. Our Investigator didn’t recommend Mr S’s complaint be upheld. She thought Advantage’s valuation was fair, considering our guidance in place at the time. Mr S didn’t agree, he didn’t think it was fair to apply the guidance in place at the time and thought our current guidance should be applied. He also provided a valuation with several adverts supporting it, valuing his vehicle at £9,406. Our Investigator didn’t change her opinion. She said she wasn’t persuaded by the adverts or report Mr S provided and said in any event, Advantage wasn’t required to obtain any more evidence than the guides when it valued Mr S’s vehicle. Mr S disagreed and asked for and Ombudsman’s decision. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Having done so, I’m not upholding it. I’ll explain why. But I’ll not be addressing every argument raised or piece of evidence submitted. Instead, in line with this service’s informal role, I’ll comment on what I consider key.

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This dispute concerns the settlement of Mr S’s motor insurance claim. But specifically, it concerns the market value Advantage attributed to Mr S’s car – there’s no dispute around the excess being deducted, or that the outstanding premium was also deducted from the settlement. Advantage valued Mr S’s car at £6,500 based on the average of two valuation guides it used at the time of the claim. Those guides valued Mr S’s car at £6,331 and £6,583. The average of those guides is £6,457 and both valued Mr S’s car at the date of the loss. Advantage says this valuation is fair because it considered the relevant guidance at the time. It said the guidance in place at the time was, broadly, to consider the available guides and ensure that the valuation was within the range of those guides. Mr S on the other hand thinks our current guidance on valuing a vehicle should be applied. That guidance he says requires insurers to evidence any valuation lower than the highest guide value with other supporting evidence – often adverts of vehicles on sale at the time of the loss. If the insurer can’t or doesn’t do this, it should use the highest guide value as the market value of the vehicle. When the complaint was brought to us, Mr S was looking for Advantage to increase its valuation to the highest guide price - £6,938. But since our Investigator’s assessment, he’s provided evidence of adverts of cars for sale at the time of the loss and a valuation report based on these adverts valuing his car at £9,406 and thinks therefore this is the fair value – because he says this indicates the guides are incorrect. Like a lot of policies Mr S’s policy with Advantage says the most it will pay on any claim is the market value of his car. His policy defines market value as: “The cost of replacing your Car in the United Kingdom at the time the loss or damage occurred with one of the same make, model, age and condition. This may not necessarily be the value you declared when the insurance was taken out. Your Insurer may use publications such as Glass's Guide to assess the Market Value and will make any necessary allowances for the mileage and condition of your Car and the circumstances in which you bought it.” Effectively this means that the insurer needs to pay the policy holder enough to allow them to buy a like for like car, were one for sale (less any deductions). In reality though, an identical like for like car is rarely available. Usually, the cars on sale have different mileages or different specs for example. So, policyholders are left with the decision of whether to perhaps spend slightly more on a “better” car – one with for example lower mileage. Or, spend less to purchase a “worse” car. Determining the market value of a vehicle isn’t an exact science, it is ultimately an opinion. It’s not and never has been this service’s role to tell insurers how to value vehicles, nor is there any set method in which they need to follow. That said, we have, and have had for some time, an approach on how we assess complaints brought to us about market value disputes. And insurers have always been expected to take our approach, as well as the relevant rules and regulations, into account when settling claims. However, we will always consider the individual circumstances of each complaint. Our current guidance is that an insurer needs to evidence any valuation lower than the highest valuation guide as being fair by providing supporting evidence. They should also take into account any evidence provided by the complainant to consider whether an amount higher than the highest guide is fair. But I don’t find it fair to apply that approach here. That’s because this claim happened before that approach was in practice. When the claim was made our approach to determine whether an insurer had fairly valued a car was to consider the available guides. Those

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guides were, and still are, considered persuasive evidence. They use nationwide data and take into account all the factors listed in Advantage’s definition of market value to estimate the vehicle’s worth. If the insurer’s valuation was within the range of those guides, we’d consider it fair – unless there was evidence to suggest otherwise. The key difference is that at the time the claim was made, Advantage wasn’t expected by this service or the regulator to gather its own supporting evidence (other than the guides). It was expected to consider any evidence presented to it, but at the time of the claim, nothing was provided. So, in assessing Mr S’s claim, I’m satisfied Advantage acted fairly when it determined the market value of Mr S’s car to be £6,500. That value was in the range of the guides it used, quoted above, and in the range of all the guides when the two additional guides we were able to obtain (£6,831 and £6,938) are included. That was considered good persuasive evidence to show what the market value was and therefore that Mr S should have been able to be purchase a similar like for like car for that amount. After we issued our assessment, Mr S provided us with some additional evidence – a valuation report valuing his car at £9,406. That valuation report has a number of adverts for cars for sale at the time of the loss. But I’m not persuaded it means Advantage needs to change its valuation. The report itself seems to value the vehicle based on simply the mean of the adverts it’s found. There’re nine adverts on the report, and if you add up the “latest price” of all those listings and divide that total by nine you get £9,406. The adverts don’t contain much detail, and they vary in mileage significantly, ranging from circa 35,000 miles to 108,000 miles – Mr S’s had travelled 105,000 miles. There’s no other calculation taking place trying to calculate the value of Mr S’s car specifically unlike the other valuation guides. Importantly, I’m not persuaded these adverts show the valuation guides were wrong either. Some of the adverts are duplicated, so taking out the duplicates leaves seven adverts. Of those seven, only two are within 15,000 miles of Mr S’s car – which is still a considerable variance. I think it’s reasonable to discount at least the other five as being too dissimilar to be persuasive. That means we’re left with two adverts, one for a car with nearly 91,000 miles on sale for £9,500 and one with nearly 108,000 miles on sale for £7,990. Both clearly in excess of Advantage’s valuation and the highest guide. But crucially, this is information presented and obtained after the claim, after the complaint to Advantage and after our Investigator issued her assessment. I appreciate the report says these are adverts for cars on sale around the time of loss, and I accept that. What the report doesn’t show or confirm is that these were the only cars on sale at the time of loss. So, I’m not persuaded they evidence this was the market at the time. Evidence of some cars on sale for more than Advantage’s valuation (and more than the highest guide) isn’t evidence there were no cars on sale for at or around that valuation (or perhaps even less) at the time. It follows then that I’m not persuaded this report shows that the highest guide value, or Advantage’s valuation is wrong or unfair. Because it doesn’t evidence that Mr S could not have purchased a like for like car were one available, at the point the settlement was made. Advantage wasn’t expected, at the time of this claim, to obtain further contemporaneous evidence other than the valuation guides, so I don’t find it reasonable to ask it to provide such evidence now, especially when that evidence is likely not possible to come by. I consider it unfair to hold that lack of evidence against Advantage now, again, because it wasn’t required to obtain it.

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So, in light of the above and having considered all the circumstances of the case, I’m satisfied Advantage took into account the guidance at the time when determining the fair value of Mr S’s car. Its valuation is in line with the available guides, which is what we’d have expected to see. Therefore, I’m satisfied its valuation of Mr S’s car, and subsequent valuation of his claim is fair and reasonable in all the circumstances, as well as being in line with the policy terms. My final decision For the reasons set out above, my final decision is that I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr S to accept or reject my decision before 13 April 2026. Joe Thornley Ombudsman

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