The owner of a 1968 Jaguar E-Type two-door Roadster has won a claim dispute over a shortfall of $60,471 in his insurance payout for repairs to the vintage car.

The Auto & General policyholder lodged a claim following an accident in May last year. The insurer obtained a quote estimate in June of $130,048 for repair costs, and another in July for $56,527 – an amount it then offered to cash settle for, plus freight costs of around $15,000.

The Jaguar driver went to the Australian Financial Complaints Authority (AFCA) seeking that Auto & General either repair the car, or increase the cash settlement to match the first estimate.

AFCA ruled the insurer, which had already paid $69,577 in September, must cover the balance of $60,471 – for a combined $130,048 equal to the earliest repair quote.

"The insurer’s settlement offer is not sufficient to allow the complainant to have the vehicle repaired to its pre-accident condition,” AFCA said. “The insurer should increase its settlement offer to $130,048 based on the assessment provided. The insurer must pay the complainant the balance, plus interest.”

Auto & General said its second repairer was prepared to do the work at a lower cost, but AFCA said this was questionable.

"The insurer had the option to repair the vehicle but chose not to do so. It was not prepared to take the risk,” AFCA said. “It is not fair in these circumstances for the insurer to seek to pass that risk onto the complainant.”

AFCA said Auto & General had not indicated any aspects of the six-figure quote - which broke down into labour costs of just over $21,000 and parts costs of $78,000, freight of $15,000, sublets of $17,325 and other items of $1,710 - that were not fair or reasonable.

Its lower July quote included only $8,404 for labour, based on an hourly rate of $29.

"I am not satisfied that this is a realistic hourly rate available to the complainant for the repair of a classic vehicle,” the ombudsman said

The Jaguar owner showed AFCA a third estimated repair cost he obtained in November of $134,258 - $19,063 for labour, $72,619 for parts, and around $15,000 for freight costs and a similar amount for sublet.

AFCA noted this was close to the insurer’s first quote yet Auto & General’s assessor only conducted a “desktop assessment” of that estimate and its one for $56,527, noting the less costly quote did not include several items included in the higher quotes, in particular stripping the front end and items such as four wishbones and windscreen damage.

The insurer did not provide any information from a mechanical or engineering expert to dispute the alternate quotes.

“It is unclear from the information provided how the assessor was able to determine certain repairs were not required,” AFCA said. "Such assessment was without inspecting the actual damage to the vehicle.”

Auto & General said it opted to cash settle the claim over repairing it due to the pre-existing condition of the vehicle, but AFCA said while there was some evidence of scratches and minor damage to the rear of the vehicle, there was no evidence to suggest the vehicle could not have been repaired, noting the insurer’s own argument that its second repairer was prepared to do so.

"The insurer’s offer to cash settle the claim is not fair in the circumstances and should be increased,” AFCA said.

“I am not satisfied that the complainant would be able to repair the vehicle based on the quote provided (in July). I do not consider the quote adequately covers the damage to the vehicle and consider the other quotes more realistic.”

See the full ruling here.