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XS Direct 3k Total Excess - Worried regarding Debt Collectors


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Found it on Insure your motor site

 

The Excess applies to damage or injury claimed by a third party. You are liable for any claim (by You or any third party) made on Your Policy up to an amount of the value of the Excess on the Policy.

 

 

For example, if You are involved in an incident where a third party makes a claim against You and there is no damage to Your Car, You will be liable to pay The Underwriters the amount up to the value of Your Excess.

 

 

If You are deemed liable for any such claims, The Underwriters will make payments on Your behalf to settle the claim on the best terms available as outlined in Condition 1 of Your Policy.

 

 

It is therefore imperative and in Your interest to cooperate fully with XS Direct in settling any claim to allow every opportunity to reduce the claim’s cost.

 

 

When the Underwriters make payments to settle such claims on Your Policy,

We will send a letter informing You of the payments made and request payment up to the Excess amount within 14 days of the date the letter is issued.

In the event payment is not received within that 14 day period, We or the Underwriters reserve the right to immediately invoke the cancellation clause on Your Policy and Your Policy will be cancelled after a further 7 days.

Any legitimate claim submitted by You and/ or a third party prior to the cancellation of this Policy will be dealt with under the terms and conditions of this Policy.

 

 

In circumstances where the Excess payment due has not been received, and Your Policy has been cancelled by Us or The Underwriters for this reason, or when Your Policy has lapsed or has been previously cancelled but the Excess payment remains outstanding, the matter will be passed automatically to XS Direct’s debt collection agency with instruction to recover the amount due. Failure to pay the Excess due, within the allocated time frame will incur further charges which are outlined. As outlined in condition1 (f) (iii), the Company can conduct the defence, admit negligence for any incident or claim on Your behalf.

 

Consequences of failure to pay/repay the

Excess Amount

In the event of failure to pay/repay the Excess amount:

(a) The Policyholder shall indemnify the Company from and against all costs and disbursements incurred by the Company in pursuing the debt including costs of a solicitor and the Company’s debt collection agency costs.

(b) At the Underwriters option, both we and they shall be entitled to immediately invoke the cancellation clause on Your Policy and Your Policy will be cancelled after a further 7 days, although any legitimate claim arising prior to the cancellation of this Policy will be dealt with.

We would like to highlight some of the potential implications of having Your motor insurance Policy cancelled:

(a) You will NOT be insured to drive Your Car.

(b) Your Car’s registration will be removed from the Motor Insurance Database and You may be stopped by police.

© This cancellation must be disclosed in future motor insurance proposals which may affect the price and availability of Your future motor insurance.

(d) You will not be entitled to any refund on premium paid and You will continue to be liable for any instalments outstanding relating to the purchase of Your Policy.

(e) We may retain a record of Your claim history and cancellation in accordance with the Data Protection Act and may share certain information with other insurers and interested parties, where necessary and appropriate.

(f) We will pass this matter over to Our debt collection agents with instructions to recover the amount due, as well as any costs incurred in doing so. Failure to pay within the above allocated time frame will incur further charges which are outlined above.

We could do with some help from you.

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Just wonder how many Policyholders in this situation don't have £3k spare and end up with a cancelled policy.

 

I can see no mention of offering a repayment arrangement. This will be a £3k debt that would be chased by debt collectors threatening to issue a court claim.

 

To me the crux is that at point of sale Insure your motor really should have made sure the policy was suitable and that in the event of a fault accident the policyholder had £3k available to pay the underwriters. If the answer was that they did not have £3k available, then the policy was not suitable. Breach of icobs.

We could do with some help from you.

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Yep, i think the Insurers have a responsibility to make sure such a niche product is understood. They should ask the question " if you had a fault accident at any time during the policy, do you have £3k to repay the Insurers ? If the answer is no, the product is not suitable,

 

The call recording just evidences them asking that he understood the type of policy i.e all sections excess of £3k

We could do with some help from you.

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The point of this type of insurance is to reduce premiums for drivers with little or no NCD or various other features that will increase the premium on a standard policy.

 

As the OP said in his first post "I had no other choice but to go with these insurers with 3k Compulsory excess as every other price at the time was above the £300 figure a month and this one was £247 monthly."

 

I would suspect that the answer to the question "if you had a fault accident at any time during the policy, do you have £3k to repay the Insurers ?" is going to be no, on a regular basis for those who consider this type of niche policy. If they had a spare £3k knocking about they could opt for a regular insurance policy.

 

It's worth a shot with the complaint of course, however I wouldn't hold my breath that it will be upheld.

 

The sad and inescapable truth is that running a car is (prohibitively) expensive.

 

OP - was your own car damaged in the incident? http://www.xsdirect.co.uk/XSDUK%20POLICY%20AUG%202016_email_Final.pdf referring to page 19 of the XS direct policy document they will deduct the value of the damage to your vehicle from the excess payment due, if you are making no claim for your own damage.

 

The catch is that the damage had to be reported to them within 14 days and I'm unsure if you did this...

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I think there is a chance the FOS will uphold the complaint, but it might have to go to an actual Ombudsman to properly consider whether the policy really is suitable.

 

If you don't have £3k spare to cover this liability, then the policy is clear that the Insurance will be cancelled and debt handed over to debt collectors. This should be an unfront warning, given the severe consequences. If you already struggle to obtain insurance having this cancellation on record might mean that you are no longer able to drive. Therefore you might lose employment if there is no transport alternative and this could lead to very bad consequences.

 

I personally don't think the health warnings on this insurance product are adequate. It might be suitable for people with enough savings or income, but the brokers Insure my motor should be required to make sure customers fully understand implications of buying the product.

We could do with some help from you.

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I disagree.

 

I believe that there is a level of personal responsibility to check yourself it's the correct policy without having to be spoon-fed or babysat through it.

 

The OP knew exactly the risks and took the policy out anyway. He took that chance to get a cheaper policy and it backfired and now, understandably, he's trying to find a way out of his contractual obligations.

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Re the other point made, here is the wording

 

Deduction for Your own damage from Your. Liability to pay Your Excess Amount

 

In instances where You have suffered damage to Your Car but have chosen not to claim on this insurance in respect of that damage You are still liable to pay the Excess amount in respect of any Third Party claim or any other payments made by the Underwriters arising from the same event. No reduction of the Excess amount in respect of these payments will apply because of Your choosing to make no claim under this insurance in respect of damage to Your Car unless the following requirements are met:

 

(a) the damage to Your Car is reported to us within 14 days of the event.

(b) We have agreed the value of such damage at the time prior to any repair proceeding.

© any value of such damage up to an amount of £500 must be supported by an estimate for the repair of such damage to be approved by Us and to be submitted to Us within 14 days of the event.

(d) any value of such damage in excess of £500 must be supported and approved by an assessment of one of Our appointed assessors to whom access to the vehicle has been provided within one month of the event.

Subject to compliance with the requirements of this clause the Underwriters will deduct the agreed value of any damage to Your Car from the Excess amount payable in respect of that third party claim.

 

I understand that argument totally. However, as this site is interested in Consumer rights, then if someone wants to pursue a complaint about what they have been sold, then any support that can be provided, is something we should support. If i thought that there was 100% no chance of success then i would have said so.

 

The whole point of the FOS is that they can look at the arguments by both sides and come to a conclusion. If at the end of the process the FOS do not uphold the complaint, then the OP has had time to save up the money and they have not had insurance cancelled while subject to an FOS complaint. I think the renewal is due in June and they can try to get Insurance elsewhere without a cancellation on their record.

We could do with some help from you.

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I agree, it is well worth the OP trying the Ombudsman, anyone who keeps abreast of the Ombudsman knows that some of their decisions do not make sense to people in the industry but would make sense to a consumer rights champion.

 

A yes or no from the Ombudsman will help the many other people in the OP's situation and whicvever way the decision goes I have a feeling it will focus XS and any of their agents in the way they sell the product to make sure there is no doubt that a "Reasonable" consumer would understand what they are buying

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  • 2 weeks later...

Hi all

 

I have had a lot going on recently within my personal life so have only got round to just writing this up properly it is still unfinished and needs some final touches I think but if anyone could take a read.

 

 

It is fairly long as I wanted to make sure they understood this is very serious for me and I also wanted to include everything I could. Let me know your thoughts and once again it is greatly appreciated.

 

FOS Complaint - http://imgur.com/a/UedIk

 

Hope you are all well.

 

J

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Seems good to me. Enough for FOS and Insure your motor to chew over.

We could do with some help from you.

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Thanks. Yea will do. When do you reckon I should send it?

 

My FOS investigator was expecting this a couple weeks ago and I haven't heard from her since and I haven't heard from Insure Your Motor nor XS Direct regarding the matter either aside from when I last told them (also 2 weeks ago) that I was going to take this dispute to the FOS, So I think they're waiting for the FOS to also get in touch with them.

 

When do you reckon the ideal time to send it off is, In regards to buying myself more time of course, When they next contact me or Immediately?

 

Just an update, I have sent through all my info to my FOS Investigator but I also received a call from my insurers (XS Direct) earlier. Stating they are issuing a 7 day cancellation. I am in a state of panic as I'm unsure what happens now.

 

I have outlined all of the above within an email to my FOS Investigator and will call her to explain. Will the cancellation be cancelled and the case of the excess placed on hold if she contacts them immediately and states her case?

 

Nevermind, After numerous calls explaining I will be disputing and giving my Investigators name and ref number over the cancellation was removed.

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Hi all

 

Hope you are all well. Here is a proper update on my situation for those still around and still able to offer me help/ assistance.

 

My FOS investigator had called me after receiving all the info needed from Insure Your Motor (my brokers).

Her stance was that the policy has been sold fairly and all the information needed was provided at sales point & within the email after I agreed via the phone to purchase the policy.

 

She also informed me an alternative was offered with a normal excess but this meant a premium of £5000 annually (In comparison to the £3000 I spent).

I did not recall this in the slightest as it was a year ago.

 

She tried to say at the end how she hopes all the best for me within the future and hopes I find a way to to pay off this excess.

I then decided I want to dispute the same complaint with the word document I sent above regarding suitability, ICOBS, Debt management etc straight to XS Direct (My insurers) and she was fine with that and is forming the complaint now.

 

She also stated how at the FOS they do not handle the design etc of company policies only if someone has been treated unfairly and re-emphasized how it is the consumers responsibility to uphold to the excess agreed at sales point.

 

I continued my arguement stated above and insisted it be re-directed to XS Direct now.

I am extremely worried as from the call earlier it seems there is not much hope at the moment.

She mentioned how I could complain to the FCA which I will look into but I am unsure how to currently.

 

Hope to hear your thoughts and what you think my following steps should be and once again I appreciate all the information and help given already.

 

Regards J

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Don't be downhearted by the FOS complaint handler and insist that the complaint is escalated to the actual ombudsman. You can have 2 complaints running. 1 against insure your motor and 1 against xs direct.

 

Ask the complaint handler for copies of the information that Insure your motor supplied to them, to see whether you remember it and it is the same as any records you might still have.

We could do with some help from you.

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Did you do a SAR data request on the broker and did they actually offer the alternative quote of £5k?

 

In my experience it would be fairly unusual for an alternative quote to be offered in your circumstances

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I haven't asked for an SAR as of yet and apparently they did offer an alternative of lower excess in return for a higher premium on the call I received at sales point.

 

I will call my FOS investigator today and ask for all the information my broker sent her regarding this case and listen to the full call myself as when I initially disputed this with Insure Your Motor they only sent me a snippet of my call from the part the all sections excess was mentioned.

 

I have requested all info from my FOS Investigator that Insure Your Motor provided them and also requested that it be escalated to an Ombudsman.

 

Meanwhile she is filing my secondary complaint to XS Direct and I await a whenever that comes.

 

Would any of you recommend trying the FCA as well or is that not worth it ?

 

Thanks

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The FCA don't deal with individual complaints as such.

They will only log issues and if they get loads of these complaints, they might look at it in the future.

 

It really is up to the FOS to do their job on behalf of consumers and take a commonsense look at a £3k all sections excess policy and decide whether ICOBS rules were met when the policy was sold.

 

The policy is not really suited to people that do not have at least £3k instantly available if they have an accident.

Insure your motor the brokers did not question the OP enough about suitability to satisfy ICOB rules.

We could do with some help from you.

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I'll message my FOS Investigator stating that I want that emphasised when she escalates it to an ombudsman.

 

My investigators point to me pretty much was that they did explain it well enough and it is the consumers responsibility when purchasing said policy but I once again argued exactly what you said,

 

Will keep you updated

 

Regads

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The FCA don't deal with individual complaints as such. They will only log issues and if they get loads of these complaints, they might look at it in the future. It really is up to the FOS to do their job on behalf of consumers and take a commonsense look at a £3k all sections excess policy and decide whether ICOBS rules were met when the policy was sold. The policy is not really suited to people that do not have at least £3k instantly available if they have an accident. Insure your motor the brokers did not question the OP enough about suitability to satisfy ICOB rules.

 

 

That rules out almost everybody though! :D

 

This kind of policy seems specifically designed for people who can't afford the £5k premium.

 

The OP took a gamble to get a cheaper premium and it backfired, but that's the risk he took.

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Insurance is for protection against risk, not a gamble leaving you with a debt owed to Insurers, with no details in the policy about repayment of such a debt. If you don't pay the amount due when requested, the policy is cancelled and debt passed to debt collectors.

 

This is potentially ruinous and could lead to loss of employment, if they relied on driving to place of work.

 

My personal opinion is that the FOS should be looking at whether this is suitable to most people it is being sold to and does the sales process comply with ICOBS.

We could do with some help from you.

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I'm assuming this is a bespoke policy for high risk customers.

 

I'm also assuming that either the OP's car is modded in some way or that the OP has been banned from driving or has insurance cancelled previously etc.

 

It is a gamble from the OP. Same as when you or I select between a £150 or a £500 excess to get a lower premium.

 

We're gambling on not crashing and needing to pay that excess.

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My car is an 07 plate vauxhall corsa SXI.

The policy was taken out 1 month after I passed my driving test so I had no cancellations on anything nor bans nor any mods.

Just a horrid policy.

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I was thinking about your case this morning and you might want to think about the following.

 

IF it looks like the FOS believe that Insure your motor did advise you sufficiently about the £3k all section excess and xs direct are legally correct in offering such a policy, then you might want to concentrate on the debt repayment argument.

 

You might then be able to persuade the FOS to partially uphold your complaint on the basis that the policy does not include debt repayment terms that are fair to policyholders. If xs direct should seek debt repayment over a minimum of say 3 years and if this is accepted by the policyholder within say 21 days, the threat of cancellation is lifted, then that would be reasonable.

 

To simply create a £3k liability in the policy terms and threaten cancellation followed by debt collection is not adequate.

It does not offer any protection to consumers from getting into a potentially ruinous position.

We could do with some help from you.

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