How Credit Hire Is Regulated in the UK
Credit hire is not regulated as a single thing. Different rules land on different parts of it: claims management activity has been regulated by the Financial Conduct Authority since 1 April 2019, the hire agreement you sign is normally an unregulated agreement sitting outside your motor policy, and the GTA that many providers and insurers work to is a voluntary industry agreement, not law. Knowing which rule is doing the work — and where none of them is — tells you what protection you actually have.
§ 01Who regulates claims management
Claims management activity in England, Wales and Scotland transferred to the Financial Conduct Authority under the Financial Services and Markets Act 2000 (Claims Management Activity) Order 2018, which came into force for these purposes on 1 April 2019. A firm carrying on regulated claims management activity needs FCA authorisation, and the FCA publishes rules and guidance for claims management companies.
Two things follow that matter to you. First, you can check whether a firm is authorised before you deal with it. Second, an authorised firm must have a complaints process, and if it does not resolve your complaint you may be able to take it to the Financial Ombudsman Service. Our complaints page sets out both routes.
§ 02The hire, and the credit behind it
Hiring a car is an ordinary commercial transaction. What makes credit hire different is the credit: you take the vehicle now, with no payment or excess upfront, and the charges are pursued from the at-fault driver's insurer. The Financial Ombudsman Service describes the agreement a consumer enters for the hire and repairs as an unregulated agreement — and that is the point most people miss, because it is what puts the arrangement outside their motor policy and outside most consumer protections they assume they have.
Where an agreement is a regulated consumer credit agreement, the consumer credit rules bite hard. In Dimond v Lovell (2000) the House of Lords held that an improperly executed regulated agreement was unenforceable, and the claimant recovered nothing under it. Agreements have since been written to sit outside that regime. Either way the conclusion is the same: read what you are signing rather than skimming it, and ask which kind of agreement it is.
§ 03What the GTA is — and is not
The General Terms of Agreement is a voluntary agreement between subscribing credit hire providers and insurers covering rates, notification and hire periods. It is industry practice, not legislation, and it binds only its subscribers. A hire arranged outside it is not unlawful; it simply sits outside that framework, and disputes about it fall to be argued on ordinary principles. We explain how it operates in the GTA explained.
§ 04Where the courts do the regulating
Much of what actually controls credit hire charges is not regulation at all — it is the law of damages, applied case by case. Whether the hire was needed, for how long, at what rate and in what class of vehicle is decided on the evidence, and the case law tracker follows how the courts have drawn those lines: the basic hire rate in Stevens v Equity (2015), the impecuniosity exception in Lagden v O'Connor (2003), and the pleading discipline in Diriye v Bojaj (2020).
This is why no one can promise you recovery. A charge that survives one set of facts fails on another, and rate, duration, need and liability can each be challenged.
§ 05Where we stop
We publish and explain. We do not assess, fund or run claims, we do not supply vehicles or handle money, and we take no enquiries: our contact route is temporarily unavailable and no page here collects your details. Nothing on this site is advice on your individual case, and reading it places you under no obligation.
You never need a paid representative to ask an insurer a question, request information about your options, or make a complaint. Contacting your own insurer or the at-fault insurer directly is free, and our contact page lists those routes.
§ 06Sources
- The Financial Services and Markets Act 2000 (Claims Management Activity) Order 2018 (SI 2018/1253), article 1 — commencement on 1 April 2019, extending to England and Wales and Scotland. legislation.gov.uk. Checked 02/09/2026.
- Financial Conduct Authority, Claims management companies — FCA rules and guidance for firms carrying on regulated claims management activity. fca.org.uk. Checked 02/09/2026.
- Financial Ombudsman Service, How to complain. financial-ombudsman.org.uk. Checked 02/09/2026.
- Financial Ombudsman Service, Credit hire and credit repair services following a “no-fault” accident — page states “Last updated: 10 July 2026”; describes the consumer entering “an unregulated agreement for the hire car and repairs” with no upfront payment or excess. financial-ombudsman.org.uk. Checked 02/09/2026.
- Consumer credit consequences where an agreement is regulated: Dimond v Lovell [2002] 1 AC 384 (HL), summarised with its citation on this site.