Can I bank my payout (interim payment)

I was involved in an accident when a car pulled out of a junction in front of me. I couldn’t swerve as there was a lorry coming the other way. I was effectively t-boned and went over the car.

The claims company acting for me sent me an interim payment from the other driver’s insurer and said I should pay it in. I’m concerned that if I do pay it in it will be seen as full payment or I may have to repay it because the letter states “This is a without prejudice interim payment. We reserve the right to reclaim this payment if we find evidence altering our understanding of this claim”.

Can I pay the cheque in?

Grant H, by email

Answer

This is a partial payment 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 making 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.