Home » British Car Insurers Busted For Undervaluing Crashed Cars, Like Cheapskates

British Car Insurers Busted For Undervaluing Crashed Cars, Like Cheapskates


British insurance companies are in a little trouble, Honda is in a little more trouble, Evergrande is in a lot of trouble, and Saudi Arabia wants to be the solution to all our troubles. Trouble…

Welcome to The Morning Dump, bite-sized stories corralled into a single article for your morning perusal. If your morning coffee’s working a little too well, pull up a throne and have a gander at the best of the rest of yesterday.

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Brit Agency Tells Insurers To Stop Screwing Customers


It’s a weird time to be a car insurance company. First, there’s inflation, which makes the cost of most things go up. Second, cars are more complicated and expensive, and parts that used to be cheap, like headlights, now cost thousands of dollars to replace. Third, and most importantly, it was some actuary’s job somewhere to guess what a car would be worth in the future, and those assumptions were probably based on a typical depreciation curve. The last few years have been extremely atypical, with residual values through the roof. The cost of replacing a car now is way higher than it was in the past.

What’s an insurance company to do?


According to the Financial Conduct Authority (I love the way the Brits name things), which is the British version of the Fair Trade Commission, some companies are just undervaluing cars. Here’s the publication’s release on the topic:

The Financial Conduct Authority (FCA) has seen evidence that some consumers who have had their cars written off after an accident are being offered by their insurance providers a price lower than the vehicle’s fair market value.

In some cases, claims staff are only increasing that offer to the fair market price when a consumer complains.

Offering a price lower than fair market value is not allowed under FCA rules. The FCA is acting against those firms that it has found breaking its rules.

The insurance industry is an extremely competitive world and so there’s a lot of pressure to keep costs down in order to not lose customers, but this sucks. If you crash your car right now you’re not in a great position to replace it without losing a decent amount of money, which is the whole point of having insurance.

Everyone Had A Great Month Except Honda


It’s great to be a Japanese or Korean automaker in the United States, unless you’re Acura or Honda. It sucks to be Acura or Honda. Let’s look at the year-over-year sales numbers from November:

  • Hyundai: +43%
  • Kia: +25%
  • Mazda: +30%
  • Subaru: +52%
  • Toyota: +10%
  • Lexus: -4%
  • Honda: -5%
  • Acura: -14%

Ouchie, bro. Some of this is due to capacity and supply chain and all that, but I don’t think that’s all that’s going on here. Honda has no real attractive options for either hybrids or EVs. Their cars are fine, but there’s no sizzle there.


Also, according to a study reported by Green Car Reports, Honda owners (and to some extent Lexus/Toyota buyers) are flocking to Tesla:

The top five Model Y conquests are the Lexus RX (from Toyota’s luxury brand), Honda CR-V, Toyota RAV4, Honda Odyssey, and Honda Accord. The top five Tesla Model 3 conquests are the Honda Civic, Honda Accord, Toyota Camry, Toyota RAV4, and Honda CR-V, the study said.

Owners of both brands have long been considered to have the most brand loyalty. But a lack of EV offerings is starting to hurt these brands in measurable ways, these results suggest.

It’s not everything, but it’s something.

What Happens If No One Buys Your Cars?


Worse than what’s happening to Honda is what’s happening to extremely random carmaker Evergrande, created by a company that was once China’s biggest property developer.

Here’s how our modern market works, generally: you can make a market, which Tesla did with the Roadster and Model S; you can be a fast-follower, which is what Toyota did when it made the Prius after watching Honda attempt the same with the Insight; or you can be too late. Someone probably lost their shirt by being the last company to produce a bunch of fidget spinners.


The Chinese car market is weird because the central government and the various subdivisions of China all pushed massive incentives to create electric cars. This ended up jumpstarting a lot of successful companies like BYD (to learn more about this I recommend Levi Tillemann’s “The Great Race”), but someone always shows up to the party when the keg is kicked and that someone appears to be Evergrande.

Here’s what Hong Kong-based financial news source Asia Financial had to report on the company:

China Evergrande New Energy Vehicle Group said in September it had started producing its Hengchi 5 model at a plant in the northern city of Tianjin and in late October said it had delivered its first 100 cars.

However, the company has paused production as there are not enough new orders for the electric sport-utility vehicle, according to two sources who declined to be named because they were not authorized to speak to the media.

Yeah, that’s not great. But don’t worry, it gets worse:

Once China’s top-selling property developer, Evergrande has been at the centre of a deepening debt crisis that has seen multiple developers default on offshore debt obligations over the past year, leaving many negotiating restructuring.

The group had touted the EV unit as key to its transformation plans, with chairman Hui Ka Yan vowing to shift the group’s primary business within 10 years from real estate to the automobile venture, and to make 1 million vehicles a year by 2025.

Triple ouchie, bro.

Saudi Arabia Is Part Of The Future Of Green Energy According To Saudi Arabia



As a journalist it’s always fun to report on Saudi Arabia because, well, they sometimes kill journalists. Saudi Arabia, for better or worse (just kidding, for worse) is a petrostate. About 46% of their GDP comes from oil and oil extraction. They can see the writing on the wall, of course, and they’re trying to see if they can find any other thing that they can do to reduce their own dependence on oil exports.

So, here’s a press release from the Future Minerals Forum, outlining how His Excellency Khalid Al-Mudaifer, Vice-Minister for Mining Affairs, Ministry of Industry and Mineral Resources, Kingdom of Saudi Arabia views all this:

“Decarbonization  – the net-zero transition – cannot happen without minerals and metals: a lot of minerals and metals. We need to scale up discoveries and we need to scale up production.”


The Kingdom stabilized aluminum markets by building an industrial city that focuses on extracting and producing final products for the world. And working with well-known electric vehicle manufacturers such as Lucid Motors and automotive sector suppliers such as EV Metals to build an integrated electric vehicle manufacturing complex.


HE the Vice-Minister renewed invitations for delegates to attend the powerhouse second edition of the Future Minerals Forum, championing the future of mining, attracting massive investment, and building solid partnerships in Saudi Arabia and throughout the mining super region that stretches from Africa to Western and Central Asia.

I don’t start shit but I can tell you how it ends.


What he’s asking for is investment so they can remove the minerals from African countries that are happy to trade them for cash, and process them using their cheap petrochemicals, thus creating a new dependency for the world. It’s better than relying on China, right? Right?

The Flush

Have you ever had a car written off? Did you get a fair value?

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