What credit hire is
When you have a non-fault accident, you are entitled to a replacement vehicle for the period your car is off the road. Credit hire is the arrangement that makes that possible without upfront cost to you.
You take possession of the car. The hire company extends credit. We recover the hire cost from the at-fault driver's insurer as part of your claim. Credit hire is well established in motor claims law and has been tested in the courts on many occasions.
What you sign, and what it means
You sign two documents:
- A credit hire agreement; this records that you are taking the vehicle on credit, with the cost to be recovered from the at-fault insurer. It is not a standard consumer credit agreement.
- A credit repair agreement, if we arrange the repair where the same structure applies to repair costs.
Your obligations are to cooperate with the claim, provide a statement of what happened, and attend a hearing if the matter reaches court and is not settled beforehand. In the large majority of cases, it does not.
Who pays, and how
The at-fault driver's insurer pays. We submit the hire costs, repair costs, and any other reasonable losses to them as part of the third party claim. They settle directly with us. You are not involved in that transaction.
If the at-fault insurer disputes the rate or duration of the hire, we deal with that dispute. It does not come back to you.
How a third party insurance claim works.
The catch, in full
Credit hire only works when fault is established and the other driver holds valid motor insurance. If fault cannot be proven, the at-fault insurer has grounds to refuse the claim. If the other driver was uninsured, there is no insurer to recover from.
We check this on the first call. If your situation does not qualify, we tell you before you sign anything.
[Wording to be confirmed against MCD’s policy on hire charges where fault cannot be established.]
Why it’s free to you
Our costs are recovered from the at-fault insurer. We do not charge you a fee, and you do not pay for the hire car. The legal costs of pursuing the claim are met by us, not by you.
This is only possible when the at-fault insurer is liable. That is why the catch matters.
Frequently asked questions
What is credit hire?
Credit hire is a way for a non-fault driver to get a replacement vehicle without paying for it. The hire company provides the car on credit, and the cost is recovered from the at-fault driver's insurer as part of the non-fault claim. You do not receive a bill.
Could I end up paying the hire charges?
In the normal course of a straightforward non-fault claim, no. The charges are recovered from the at-fault insurer. In cases where fault cannot be established, that recovery may not be possible. We explain this before you sign anything, and we do not take on cases where we do not believe the recovery is achievable.
Is credit hire regulated?
Motor claims handling is regulated by the Financial Conduct Authority. Credit hire agreements are not consumer credit agreements under the Consumer Credit Act 1974, but the sector operates within agreed industry protocols and the courts have established clear principles for what is recoverable under a credit hire arrangement.
Do I have to go to court?
In most cases, no. The majority of claims settle without court proceedings. If the at-fault insurer disputes liability or the hire costs and the matter cannot be resolved, proceedings may be necessary. If that happens, we manage the process. Your obligation is to provide a statement and, if required, to attend a hearing.