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Title: Can I cash the cheque?

Date: 08 June 2016

Question

I had an accident when a car pulled out of a junction blocking my side of the road 'didn't see me'. I couldn't swerve as there was an oncoming car in the other direction. So hit the wheel arch and landed on his bonnet still holding my handle bars - ouch!

I've had a low offer from the third party’s insurer which I refused straight away. I've sent off all the evidence for the refusal and the individual prices of all the mods to my bike to back this up.
My claims company has sent me the first cheque from the third party’s insurer and said I should pay it in. But they have told the third party that it is an intermittent payment and that I'm not accepting it as a full payment. I'm just worried if I do cash it will they think 'oh she has cashed it so she accepts that amount'. I just don't want to be screwed over.

The cheque arrived but how the letter is worded from the third party insurer confuses me a tad. It says “This is an interim payment issued without prejudice. Because of this we reserve the right to claim this payment back if we find further evidence that changes our understanding of this claim”.

Seems to me like that's basically saying if we find out you're to blame we will take it back. Not sure what to do?

Saphy-Tiger, MCN forum

Answer

The correct term is interim payment, i.e. paid on an interim basis, until such time as the claim concludes. The value of interim payments made is deducted by the paying party at the end of the claim to avoid a Claimant obtaining a double recovery.

The wording used by your opponent’s insurer is to protect them should something come to light meaning that in fact the accident was your fault. They have reserved the position to reclaim the money from you in the event that this is the case. Based on the facts you have outlined this is unlikely to be relevant.

Sometimes insurers issue interim cheques with the cover letter stating that it is in full and final settlement of the claim. In these circumstances the Claimant’s solicitor should write confirming the real position and that it will be banked on the basis of it being an interim payment.

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