When policyholders collect their vehicles from a repairer, which of the following might they be required to pay?

Policyholders collecting their vehicles from a repairer may be required to pay various costs that arise as a result of the repair process. Each of the costs mentioned has a valid reason for being potentially chargeable.

Firstly, the excess shown in the policy is the amount that the policyholder agrees to pay towards any claim before the insurance covers the rest. This is a common feature in insurance policies and is usually a clear condition that policyholders must be prepared to meet when their vehicle is repaired.

Secondly, VAT recovery plays a role in the costs. If the policy has a VAT-inclusive structure, and the insurer is unable to recover VAT from HM Customs and Excise, the policyholder might have to pay this amount out of pocket. This often pertains to the overall claim amount, as VAT needs to be factored in depending on how the contract is set up.

Lastly, betterment costs may also apply. This occurs when repairs enhance the vehicle’s value beyond its pre-accident condition. Insurance policies typically should not provide coverage for improvements beyond the original value, and thus the policyholder would need to cover these costs.

In summary, all these aspects—excess payments, potential VAT charges, and betterment costs—can apply when a policyholder collects