Evening all.

I have some involvement with a local football club and we are having some threatening letters from an Insurance Company that provided us with Public Liability Insurance last season.

We verbally agreed to a renewal policy for this season, but were automatically covered by our County Board and so never made any payments for the current season. They are now demanding the whole payment in full (from March 2010 - March 2011) and we only want to make a payment for the two months that we neglected to pay for and did not inform them of the cancellation (change of secretary led to some confusion).

They are stating that a signature is not required for Insurance renewals and also that once the renewal is in place, early cancellation is met with a demand for the full amount.

Where do we stand?

I thought that a verbal agreement was only temporary and had to backed up with a signed copy asap. I can not see any clause in their policy for early cancellation either.

Thanks in advance.

Have you spoken to your Brokers??

Have there been any claims on the PL Insurance?

Technically, you have agreed to a years contract. Usually, if there have been no claims on the Insurance then they would consider a partial refund - however, you would have to stand your corner hard.

Thanks Craig.

No, there has not been any claims in the two years we had the policy.

Does this mean they can legally renew a policy on a verbal instruction without then seeking a signature? And then ask for the whole amount without a clause in the contract?

Unless you are a professional football club my guess is that you have accepted verbally to the "sub broker" who has given authorisation to the broker to proceed with the Insurance Company to proceed. One of these brokers has signed on your behalf. When you accepted terms with the broker to place your business, you will have signed a document agreeing for them to act on your behalf, in your best interests.

Having said that, my expertise is in commercial claims, so I am not 100% on this - maybe a broker could confirm this?

That's exactly it Craig.

We don't mind paying for the two months before we cancelled, but don't really want to (or can afford to) pay for the whole year twice.

We just need to know where the law stands with this so we can point to this when we offer to pay for the time before cancellation.

Thanks

Yeats,

As this is a "Commercial" Insurance policy, you certainly would need to give an agreement to renew however in general, this is an annual contract and probably only has a cancellation clause benefitting the Insurer and not the policyholder. Liability claims can have a long tail i.e. claims made long after expiry but during the period cover was granted hence the reasoning that no rebate would be forthcoming.

If you can get a letter from your County FA confirming there was a duplication in cover and that the FA policy would respond in the event of any claim then your insurer may consider the policy void and cancel "ab initio".

Personally though I think you may be stuck with the policy in view of potential claims occurring - worth checking with the FA though.

Thanks Trojan.

We are not trying to get money back for the cover, they are asking us to pay for the whole year as we neglected to inform them that we no longer required their cover.

We just need to know where we stand legally and the strength of our position if they decide to take it to court. We need to know if they can renew for the whole year without a signed agreement and if they can hit us for the 12 months payment, or until they cancelled the agreement.

Thanks Trojan, maybe you can help with this as you seem to know your stuff.

Whilst my own area is large corporate type insurance, the same principle will agree to an annual policy whereby there will not be a cancellation clause - as it is a commercial product, the usual 14 day cooling off period will not apply. Instaments are simply a facility to pay the annual premium. Saying that though the insurer/broker would be obliged under the FSA to provide full renewal documentation within 30 days of the renewal date.

I think the best way of trying to resolve the issue is to get a letter from the FA confirming you were covered under their group arrangements and any Insurer worth their salt will agree to cancel "ab Initio" i.e. as if no cover was in force.

Strictly speaking though, they are within their right.