Return insurance claim?

Citygirl1

Hi - A friend of mine has been involved in a situation where damage was done to property by a third party, and an insurance claim was submitted to cover most of the repair costs.

Many moons later, the culprit has now been ordered (by the courts) to pay compensation to the victim, in the amount of the damage caused.

In this situation, would it be expected that the claim recieved from the insurance company should now be returned? I'm honestly not sure what is the norm so would appreciate your thoughts....

barrmur

Could be wrong but I remember hearing something like "when you get a payout the right to claim passes to the insurer".

I think in this case the insurance company would be in line to get whatever payout the mug has to make. As far as you are concerned your contract with the insurance company has been completed and as such I would inform the insurance company but not worry to much about refunding them.

Don't worry, I have never heard of an insurance company neglecting to get money that is on offer.

Insurance Works

The insurance company would have made a payment for the cost of the damage less the amount of the policy excess. (The policy excess is the amount that the policy holder is supposed to pay in the event of a claim.)

In a situation like this when the money is paid to the claimant by the person who caused the damage the claimant should then keep an amount equal to the policy excess, the cost of which they should have already incurred and make payment of the remainder of the money to the insurance company.

I know for sure this is the correct procedure which should be followed, as I can actually remember such scenario appearing during an insurance exam I was sitting a few years ago.

Hope this helps !!