Octagon Insurance / Premium Credit

[hyperjase]

I have a small issue with the above companies.

 

I took out good priced car insurance through Octagon insurance, who then set up monthly payments through Premium Credit.

 

This week one payment was missed, the one and only, in the time I have been with them.

 

I contacted Octagon to be told the payment was requested again (which is fine) but a £20 charge has also been applied .

.. which means I may not be able to afford the amount being taken, plus that charge.

 

I can't speak to Premium Credit today (as it's a Saturday) but will Monday (and I suspect the payment will be taken Monday).

 

My question is,

can they apply such a charge on the first (and currently only) failed payment?

 

Is this lawful?

 

Can I request this back,

 

or can I make a formal complaint to any body that oversees credit providers?

 

Many thanks.

[unclebulgaria67]

If the £20 charge is written into the terms they can. If it is not mentioned, they can't charge it.

 

Octagon are a very small company, who I think use Gibraltar registered Insurers to underwrite their policies. They don't have big offices with loads of staff, so most of their admin processes are handled by outside companies. For those that pay by monthly instalments, you are basically taking out a loan from premium credit and the terms of that loan should have been sent to you, with a consumer credit agreement. This will note the £20 charge for the direct debit problem.

 

I would suggest that you somehow find the £20 and pay it into your bank, so the payment is met. If you fail to do that, I expect the Insurance will be cancelled and you will end up owing much more, with cancellation charges added.

[hyperjase]

If the £20 charge is written into the terms they can. If it is not mentioned, they can't charge it.

 

Octagon are a very small company, who I think use Gibraltar registered Insurers to underwrite their policies. They don't have big offices with loads of staff, so most of their admin processes are handled by outside companies. For those that pay by monthly instalments, you are basically taking out a loan from premium credit and the terms of that loan should have been sent to you, with a consumer credit agreement. This will note the £20 charge for the direct debit problem.

 

I would suggest that you somehow find the £20 and pay it into your bank, so the payment is met. If you fail to do that, I expect the Insurance will be cancelled and you will end up owing much more, with cancellation charges added.

 

Thanks for the info, I was just a touch shocked that they apply it on the first payment, second understandable but anyhow.

 

Aren't these "charges" supposed to reflect the cost incurred to the company? £20 for resubmitting a payment seems a little high to me.

 

Many thanks.

[BRIGADIER2JCS]

If a payment on a motor insurance premium the insurer could issue a default notice giving you a very short time to remedy or they will cancel the cover.

[dx100uk]

the £20 never the less is a fixed sum PENALTY charge

 

which ofcourse is unlawful.

 

dx

[2ltr16valve]

I've had the £20 taken off before with this company for car insurance. Just stress that you can make the payment but not the charge as well. They can take a payment Over the phone.

[hyperjase]

I could pay the amount today but they're not open. I suspect by the point I can talk to them they will have taken payment and charge but I'll be calling them to request an unlawful charge be refunded otherwise I'll refer it to the FCA. Might get me nowhere but also may get a result.

[unclebulgaria67]

I could pay the amount today but they're not open. I suspect by the point I can talk to them they will have taken payment and charge but I'll be calling them to request an unlawful charge be refunded otherwise I'll refer it to the FCA. Might get me nowhere but also may get a result.

 

These charges are not unlawful, as they are contained in the contact terms. I am not aware of any court case or FOS ruling saying that these charges are unfair.

 

Whether they will waive the £20 charge, is up to the person you talk to and whether they have the authority to waive them. I suspect that is a contractural term by Premium Credit and they are not allowed to waive them, unless there is an exceptional circumstance.

[dx100uk]

any PENALTY fees are unlawful as they are a PENALTY

 

FCA [FSA] clearly stated that

 

just like the bank charges - what is in a T&C can be challenged.

 

its a finance agreement and has a CCA that has been agreed to & signed

so its a loan under CCA, loan charges can be reclaimed

 

dx

[unclebulgaria67]

any PENALTY fees are unlawful as they are a PENALTY

 

FCA [FSA] clearly stated that

 

just like the bank charges - what is in a T&C can be challenged.

 

its a finance agreement and has a CCA that has been agreed to & signed

so its a loan under CCA, loan charges can be reclaimed

 

dx

 

Only unlawful, if they can proved to be a penalty.

 

The FOS have looked at these Insurance charges and they have found that they are fair. Insurers can evidence that the charges purely cover their costs.