Credit hire organisations often face difficulties in recovering their costs from the third party insurer. In many cases, claims can be resolved internally as the third party insurer settles the claim promptly and no further action is needed. However, in a significant number of cases, the third party insurer might delay payment, dispute liability or attempt to negotiate the sum owed. It can be difficult to decide when to pass a credit hire claim to your solicitors. This blog summarises five situations where it may be beneficial to pass a claim to solicitors to achieve prompt and satisfactory settlement.

1. Denial of liability

Credit hire vehicles are usually only given in cases where liability for the accident can be clearly attributed to the third party driver. However, in some cases the issue of liability is not clear cut and third party insurers may dispute liability after the cost of the credit hire vehicle has been incurred. Such disputes can be complicated and negotiations with the third party insurer (if they are capable of being resolved) can last for months. Referring the claim to your solicitor to provide advice on the prospects of a case and decide on the best approach from the outset at an early stage will minimise any costly delays. They can also take steps to recover information by way of court order, if necessary, to help establish liability.

2. Intervention arguments

The legal position around intervention is complicated. What might initially appear to be a valid intervention letter can often turn out to be ineffective. Referring the claim to solicitors will ensure the appropriate investigations can be made before deciding whether to contest an intervention argument.

3. Insurer requesting vouching documentation for the customer's impecuniosity (having little or no money)

It is an established principle that vouching documentation in the form of personal bank statements is required to prove that a customer could not have afforded to hire a vehicle on their own account. However, customers are often understandably reluctant to disclose such sensitive information and often feel more comfortable disclosing them to a trusted firm of solicitors.

4. Unnecessary delay

In some cases, the third party insurer simply delays paying the credit hire or repair charges. Instructing a solicitor to raise legal proceedings can often be an effective way to progress matters.

5. Accident occurred some time ago

In Scots law credit hire claims prescribe five years after the date of the accident. This means that after five years it is no longer possible to raise court proceedings for the loss. While it may sound like a long time it can pass quickly when there are multiple issues in dispute. In England and Wales a six year limitation period applies which can cause confusion for organisations operating in both jurisdictions. In a case where the customer has suffered an injury and is making a claim for that injury, the time limit in relation to hire claim effectively becomes three years rather than five. Referring the claim to solicitors at an early stage will ensure the matter can be settled or litigated before any deadlines are missed.


Laura McMillan

Partner & Director of Advocacy

Eilidh Campbell

Trainee Solicitor