NIG, full years premium requested for fault claim

[kfdh1962]

earlier this year my partner took out an insurance policy with NIG with her son ( a newly qualified driver) listed as a frequent user. Just 2 weeks into the policy he crashed the car, which was subsequently written off by NIG ( car was only worth £600)
so nig offered £645 for the car, deducted the £550 (yes £550) for the excess for a young driver claim and paid out the remaining £95,and the plociy was terminated.
NIG (owned by LLOYDS incidentally) are now demanding full payment of the years premium as this was a fault claim.
Firstly, what do they mean by fault claim, and secondly is this legal?

they were paid one months premium up front and the car was on cover for just 2 weeks before the rta. I would expect the requested premium to be pro rata for the annula some ( so this they had already had) plus a further considration for a rsik factor as it were

obviously we dont have the £847 to pay them which is why we paid by installments....not sure what to do next..advice greatly appreciated

[xrchris]

It is normal procedure for an insurer to request full payment of the outstanding premium following a 'fault' claim on the policy.

Was your son to blame for the incident?

NIG is NOT owned by Lloyds but is part of the Royal Bank of Scotland group of insurers (along with Direct Line, Privilege, Churchill etc etc).

[kfdh1962]

Hi xChris,

yes, he was to blame for the accident, he crashed into the back of the other vehicle.


the policy was purchased through screentrade, underwritten by NIG so maybe its screentrade that owned by lloyds, i definitely recall one of there employees mentioning this

[craigwalton]

This is the norm. You have taken a full years contract for insurance. It doesn't matter when the crash happenned (1 day after the start of the accident, or one day before the end, they are entitled to ask for the full premium as it was a fault accident. But dont worry!

Your best bet is to pay them the £95 and advise them you wish to withdraw the claim. You then advise them you wish to cancel the policy (should be 14 days notice) and pay the extra for this 14 days. They will then cancel your policy - your no claims discount will not be affected.

A lot cheaper than paying the full premuim!!!

[kfdh1962]

Hi Craig,
there is a third party involved, claiming for damage to her vehicle and for personal injury,i would guess this will prevent withdrawal of the claim

[craigwalton]

The only other thing you can do is to get the car replaced ASAP and to put the new car on the policy