Privilege car insurance - advice needed!!!!

[gemspan]

HI there

 

I would be grateful on any advice you could give re the following.

 

Last year I was suffering severe financial difficulty and claimed against banks for charges to be refunded. During this time one of my dd's to privilege was returned. I called them and paid by card. the next month the same thing happened and I called them to apologise and pay by card. It was a cash flow thing. They refused to take the payment and said that I had to pay the whole policy. I couldnt afford to pay the whole thing but said I could pay 2 months in advance. They refused and said they would cancel the policy. This was their decision - not mine!!!! Now, obviously I had to get new car insurance and have done so. I got a letter 2 weeks ago saying that I owed them over £200 (privilege!) as I had made a small claim on the car insurance during that year. I have been really busy with a new job and havent had time to call them. I received a letter today from a debt collector asking for the money.

 

My argument is this. I didnt want to cancel the policy; they made me! I had no choice. I offered to pay what I could afford - in advance - and they refused. I explained my circumstances to them but they werent interested.

 

What options do I have here? I feel that if they cancelled the policy then they should cover the loss. I may be wrong though.

 

Thanks in advance.

Gemspan

[Trojan1401]

Just noticed this thread.

 

My own opinion on this is that they are correct as you did not keep to the credirt agreement so in effect defaulted. The charge will undoubtedly be made up of short period cancellation charges however, my view would be that as they have enforced cancellation that they should do so on a pro-rata basis and not include any admin charge.

 

I suggest that you request details on how the "time on risk" was calculated & what was paid by you in total.

[gemspan]

Hi Trojan1401

 

Thanks for your reply. Actually, they are saying that because I claimed on the insurance I am due to pay the whole amount. The claim was at the beginning of the insurance and was a small claim of £200. I didnt want to cancel the insurance and I would have been able to pay the remainder of the insurance a month later. However, they wouldnt hear of it and cancelled the policy. I then had to find alternative insurance. I feel that because they cancelled the insurance then it was their decision, not mine. Also, there was no mention of defaulting on payment - only that this claim had occurred. What do you suggest?

 

Thanks

Annie

[bed32]

Are you saying that they cancelled the policy and have asked you to pay the full premium for the entire term? If so that seems unreasonable.

[lenny100]

i9 Have just had the same fight with noorwich union and took it all the way the the fos but lost as they said it was in their paperwork they send out.

so look as though its a way for them to rip of car users who are in this situation through no fault, but due to their policys

[gemspan]

Hi there

 

Yes, that's exactly what they want. They cancelled the policy but now they want me to pay the whole amount. My argument is this:

 

I offered to pay the installment and one additional installment; they refused and cancelled the policy. They now want all the money although they knew that I couldnt afford it. What is the point of this? Why didnt they just let me pay the installment?

 

Annie

[Trojan1401]

Hi,

 

There are two issues here. Firstly, the terms of the policy will state that no return in premium will be provided should a claim be made against the policy. In this instance there was a claim so no refund would be allowed. I think we agree on this one but to qualify, a motor policy is an annual contract and instalments are only offered to facilitate payment of the annual premium.

 

The issue here though is the unsympathetic view of the insurer concerned where gemspan offered to make good the shortfall but offers effectively fell on deaf ears and that no doubt the clerk(s) simply followed procedure.

 

I certainly empathise with the situation but I'm afraid that the insurer simply took the easy way out. This would not have happened in my day, I would've ensured that a fair proposal was made and provided that the insured kept to it then no problem.

 

This is all down to cutting costs for the insurer/broker whereby finance is outsourced and any default is simply passed to a DCA. Same view as the banks !!!

 

Ironically, Privilege is owned by Direct Line & guess who owns them - Royal Bank of Scotland. Annie, as your in Edinburgh, why don't you hand deliver a complaint to them at their wonderful new expensive looking H.O paid for by no doubt our money !!!

 

I'm afraid I can't be any more constructive as I believe the have you on this. Only way is to see if there is a human being actually working there who may waive / write off the amount or at least reduce it.

[xrchris]

Forgetting the instalment issue for one moment, your policy clearly states the following -

5 Uneconomical repairs

If your car is uneconomical to repair (written off) and

we agree to settle your claim on that basis, you still owe

the full yearly premium as we will have met all our

responsibilities to you under the policy. Once we settle

your claim, your car will become our property and you

must send us the registration document. All cover will

then end unless we agree differently. We will not refund

any of your premium.

[Trojan1401]

xrchris,

 

I don't think this was a w/off, just a small claim against the policy but that would still mean no refund allowed under the t&cs.

 

All I can suggest is perhaps a sympathetic senior bod who can actually make a decision as opposed to the usual call center "computer says no" scenario which we are all to familiar with.

[bed32]

It must surely be worth taking this up with the Insurance Ombudsman.

 

Privilege are certainly acting within the terms of their T&Cs but it does not seem fair and reasonable to cancel the contract for non-payment and then to demand full payment anyway.

 

Otherwise they may be a way to claim the money back under the "Unfair terms and conditions" but you need someone more experienced to advise you on that one.

[Trojan1401]

Unfortunately, They are on two counts ;-

 

1. Default on instalment agreement - cancellation of policy

2. Full annual premium due -claim made on policy

 

As I said previously, I believe only a sympathetic ear may help.

 

I have to agree with the insurer on this, albeit it does appear to be unfair.

[gemspan]

Hi there

 

Thanks for all your comments.

 

THe car wasnt a write off. To be honest it was a taxi that I supposedly backed into. I didnt feel anything in my car and he immediately opened his boot and showed me a hairline crack in the padding on the inside of his. There were not witnesses and my friend suggested that he was probably hit by somebody else and was trying it on with me as there were no witnesses. I let him claim for an easy life. I wish I hadnt now!!! Anyway, the claim was £200.

 

I could see the point if I was unwilling to pay the installments but I had missed one and was willing to pay it and another to bring the insurance up to date and also pay additional monthly premium.

 

I really think this is unfair because I have had to get another insurance, which was more expensive because of the claim - and now they want the whole amount. I just cant afford to pay it!!!!

 

I think I will write to their head office and set out the case to a senior customer relations manager. They also had only just sent me this demand letter when another came from a DCA. Surely they must give me some time to find the money?

 

Annie

[Trojan1401]

Hi Annie,

 

So I do not appear callous, I do sympathise with the situation and agree that they should have allowed you to make up the instalments but I'm afraid we are all just numbers now not customers. The "Customer Advisors" are correct and simply followed procedure - "Computer says NO !! attitude.

 

Typical involvement now of DCAs as insurers no longer have their own debt recovery units where if they had one, you would've had a more sympathetic ear.

 

Definately write to HO where you may get some consideration.

 

BTW I would expect that you were stung by the taxi driver without a doubt & you were the first scapegoat to come along.

 

Good luck.

[Darren]

Hi Gemspan

 

It seems the reason they cancelled your policy is because you chose to pay by card and not DD

 

I have just checked the T&C's of my policy. it says that monthly instalments are covered by the Consumer Credit Act. check this document if you have it as the booklet states that if you fail to pay your instalment by the due date they may canel your policy, but when you rang to pay by card the policy was still in force and you offered to pay the next months instalment so it would have been up to date. I dont have an agreement to check but the T&C booklet does not state that instalments have to be paid by DD and this seems to be the reason they cancelled your policy.

 

I would complain to privilege, Direct line, Financial Ombudsman Service and Financial services authority.

 

I dont know if it will get you anywhere but it will put the debt in dispute until its sorted and this will at least give you time to pay.

[gemspan]

Hi there

 

If the monthly instalments are covered by the CCA then they have to send me a default notice before they cancel. Is that not right? The policy wasnt cancelled and I didnt receive a default notice. I didnt even receive a letter advising me that the instalment had been missed. I phoned them when I took a statement from my account and saw it had been returned. This happened once before when I was changing banks and it took a while for the DDs to be transferred. I paid them over the phone that time and explained the situation. I just remembered this. I have to go to work now but I will check the T&Cs when I get back tonight. I just feel it is unfair because I did offer to pay the instalment and another one to boot.

 

Thanks for your help.

Annie

[Trojan1401]

This does perhaps put a different slant on the issue.

 

One more thing though, did Priviledge inform you in writing by recorded delivery that the policy would be cancelled. Under the RTA, they are obliged to inform you by recorded/registered post of their intention to cancel, giving a minimum of 7 days notice. In that letter, they must also quote " that it is an offence under the RTA to use or keep an uninsured vehicle on the public highway".

 

Did they follow this procedure ?

[lenny100]

This does perhaps put a different slant on the issue.

 

One more thing though, did Priviledge inform you in writing by recorded delivery that the policy would be cancelled. Under the RTA, they are obliged to inform you by recorded/registered post of their intention to cancel, giving a minimum of 7 days notice. In that letter, they must also quote " that it is an offence under the RTA to use or keep an uninsured vehicle on the public highway".

 

Did they follow this procedure ?

 

 

Acording to my case and the fso they dont have to send anything via recorded delivery, standard second class delevery is considerd to be deliverd with three days delevery if you recived the notice or not.

[bed32]

It so happens that I have just been reading the Privilege T&Cs from cover to cover

 

As I read the policy document if they cancel the policy then they have to give you a refund. The bit about not refunding after a claim only appears to cover the situation where you cancel the policy.

[gemspan]

Thanks for that Bed32. I think that Privilege have fallen down on a few things here. They havent sent me a default notice; they didnt send letter of termination by RD and now it appears that they may have to give ME a refund.

 

Every day life has been getting in the way re this ie been so busy. Tomorrow I have a day off so I will be sorting all my business stuff out.

 

Thanks again

Annie

[bed32]

Yes - privilege do appear to be a load of clowns. Their handling of my current claim would be hilarious if it weren't so serious.

 

None of the people I have been speaking to even understand their own policy document still less the FSA rules (ICOB).

 

I've already had an informal chat with FSA about them and I will be raising a complaint as soon as they've paid up...

[kfdh1962]

i dont see how they can demand a full years premium when the vehicle was only covered for portion of the time...surely it has to be pro rata...

 

my partner is having similar issues ...her son wrote off the car after just two weeks on the road, first installemnt was made but second installment missed due to halifax charges!! so for 2 weeks cover they now want the whole years remaining premium due to it being a "fault claim"...car written of at £600 , £550 excess, and now they want £847, simply cant pay it and son lost his job to boot due to lack of transport!!

Do these issues not come under the unfair terms and conditions in consumer contracts, i.e terms not indivudually negotiated ...biased to the service provider..section 5 methinks???