£45 to cancel a motor policy???

[Perseus]

Hi

I've just had a rather heated debate with some jumped up snotty nosed jobsworth from Diamond Car Insurance (my opinion here!).

 

My other half wanted to cancel her car insurance policy, called up, 'Yeah - no problem, that will be £45 to cancel!'

This is a £45 admin charge to cancel cover. It does not include any pro-rata premiums not paid, purely an admin charge of £45 just to cancel.

 

According to Mr snotty, who was adamant that because they were regulated by the FSA, and all their T&C's are 'signed off' by the FSA, the charge is wholly justified. If we fail to make the payment of £45 on receipt of their written demand (2 weeks notice), they will pass immediately to a DCA/Court for collection as my other half agreed the terms on renewal each year.

The £45 is on the reverse of the Cert of Insurance.

My OH passed the phone over to me to deal with.

 

I quoted that these costs surely do not reflect their actual losses, and represent an unlawful charge/penalty. Mr snotty blew up stating that they were specifically agreed by the FSA as justified, and my OH agreed the T&C's when she took out/renewed the policy.

 

I immediately advised that if he can produce a letter/guidance/confirmaation from the FSA that this particular charge was agreed to be justified, I would pay. In one breath he said - yes I'll get that letter sent out straight away, then back-pedalled and advised that they don't have to justify as it is in T&C's, and stated that they would not have (nor need to produce) the FSA agreement on the charge as it's already been accepted by my OH.

 

I've specifically put the account in dispute, advised that if they threatenn to disclose to a 3rd party, I'll s10 DPA them, and complain to the FSA and ICO re charge and disclosure.

 

The question is.................

 

Can I legally challenge the £45? If brought to court, can I defend using UTCCR's or something other more relevant...

 

Any advice anyone, please?

 

Thank you

Perseus

[humbleman]

most insurance companies are doing this now, i have heard of companies charging an equivalent of 1 months premium. Now if you have a monthly premium of £200 then your cancellation is £200, if its £15 then its £15, I dont't see any fairness in that. BTW was this 45 equivalent to 1 months premium.

[Perseus]

Monthly premium was £22. The charge is set as a standard £45, and is noted on the back of the cert of insurance if you wish to cancel.

Bloody extortionate.

 

Surely this is an unfair term?

[xrchris]

most insurance companies are doing this now, i have heard of companies charging an equivalent of 1 months premium.

 

Most direct insurers do this but many broker sourced policies have no cancellation fee at all, ok a few do charge but nowhere near the amount of the direct writers.

 

One example NU Direct canx fee 'up to' £52.50 but NU's Broker sourced policy has a fee of just 'up to' £10.00.

[Rob S]

I have no problems with insurers applying short term rates should a policyholder wish to cancel their cover before the policy expires, but adding a cancellation charge of £45 on top is ridiculous. Have you written to them and asked them to give a full breakdown of how they arrive at a cost of £45 for a simple administrative task?

[Perseus]

I had a long a very heated debate with this wazzuck, and he reckoned that it was to cover the three or four different departments that have to deal with a cancellation!

Either way, I'll be defending any action if they cannot produce a breakdown of the actual costs/losses incurred.

Stuff 'em.

[humbleman]

I had a long a very heated debate with this wazzuck, and he reckoned that it was to cover the three or four different departments that have to deal with a cancellation!

Either way, I'll be defending any action if they cannot produce a breakdown of the actual costs/losses incurred.

Stuff 'em.

 

They might have to goto 100 different departments, thats their problem, cancelling a policy is just a press of button.

 

These companies fail to realise that their business is to issue and cancel policies, its part of their business all the rest of the fees/charges is just a way of extra revenue. Surely that will not have to do overtime just because you cancelled your policy to justify the charge, its just part and parcel of their job.

[DollyDayDream]

I have just changed my policy and foolishly did not read all the small print on the back. Saga (yes, I'm a grandma!) want to charge me £138.82 for cancelling a policy.

I had assumed that any contract I had with them was for the existing policy until it expired, and that unless I chose to renew it there could be no further contract. Their attitude seems to imply that they have the right to assume that I will always choose to renew with them, rather than check out other options. I would like to know the Financial Ombudsman's opinion and also the OFT.

DDD.

[Perseus]

Well hello, Dolly.

 

I used to work for Saga Car Insurance many moons ago...

 

They used to operate a policy of;_

Cancellation in the inception (1st) year of business = £10 admin plus a pro-rata refund of the annual premium (if paid in full at the start of the policy).

Cancellation in the Renewal or subsequent years = £10 cancellation admin fee.

 

Can you tell me...is this your renewal year of the policy?

If so, when was the renewal date?

If it's your 1st Year, when was it started?

 

Unless (as I've found out) they quote an admin charge for cancellation, they cannot ask you to pay insurance premiums for a risk they are not insuring.

 

As with mine, I will be challenging the admin fee they are trying to squeeze from us. It is wholly unjustifiable, therefore a penalty in my mind.

 

Perseus

[DollyDayDream]

Hello Perseus

I have had the policy since 2004 and paid by direct debit. The renewal date was April 24th. I sent back the papers saying I did not want to renew (and cancelled the direct debit). I did not make a note of the date I sent it back to them. I think it is outrageous that they can try to do this. Surely this is a case for the Insurance Ombudsman and the OFT?

DDD.

[xrchris]

What was your reason for not wishing to renew?

 

If it was because you changed insurer or did you no longer have the car?

[Rob S]

Dolly, can you clear something up please? Has your old policy expired and you have taken your business elsewhere, or are you trying to cancel your policy with Saga mid term?

[Perseus]

What was your reason for not wishing to renew?

 

If it was because you changed insurer or did you no longer have the car?

Hi

SOld the car, phoned the same day - and because he policy had auto-renewed more than 14 days before - that's when they recon that the charge is justified (as per the back of the insurance cert!.

[IIIUMINATI]

What Happens If The Policy Holder Dies ?

[IIIUMINATI]

Read the policy and strike out any terms which you do not agree to.

If the company acepts ok if not move on.

Good marketing point for the better companies no penalty charges

should you be unable to drive.

[DollyDayDream]

It was the end of the policy, and they sent me the papers for a further year. I found a far cheaper policy elsewhere. Because I paid by direct debit they seemed to think they could hold me to ransome!

DDD.

[xrchris]

It was the end of the policy, and they sent me the papers for a further year. I found a far cheaper policy elsewhere. Because I paid by direct debit they seemed to think they could hold me to ransome!

 

DDD.

 

Just write a short note to say you had arranged alternative cover and provide a photocopy of the new insurance document. This should sort your problem out with the right result. (i am assuming the new policy started on the renewal date of the previous policy).

[Rob S]

It was the end of the policy, and they sent me the papers for a further year. I found a far cheaper policy elsewhere. Because I paid by direct debit they seemed to think they could hold me to ransome!

 

DDD.

 

They are really taking the mick! Did you inform them before the policy expired that you would not be renewing with them?

[Derv]

I've just had a similar problem, I did post it on here last night but it seems to have disappeared!

 

I have a motorbike policy with Bennetts. After I'd done some mods on it I rang to inform them, and was told that the insurance co (they said it was Equity red star but I'm sure it was AXA) didn't cover modified bikes, and I'd have to cancel the policy and take out a new one.

 

I asked how much that was going to cost me and they quoted £135 F/C plus a £30 transfer fee. I asked how much I'd get refunded on my previous policy as it still has 4 months to run, and the girl told me that they didn't refund on cancelled policies with so little time left to run. I pointed out that 4 months is 1/3 of the policy duration remaining, so it's not unreasonable to expect something back to offset the cost of tranfering to another company

 

She said no - they had to charge the £30 admin fee and there would definately be no refund on the remaining policy. I told her that was disgusting and after being a customer for over 10 years expected better, and if that was the case I'd just cancel the policy with them straight away and go somewhere else to insure my bike. Which I did!

 

I told her to cancel the policy but said I wouldn't be paying for the pleasure, and she had to cancel it because it's illegal to have 2 seperate policies running on the same vehicle. If I was later pulled by the police and found the there were still 2 policies running ion the bike I'd hold them fully responsible as they had been told to cancel the present policy. She said no probelm we'll just bill you anyway

 

I found a new policy with a broker that deals with modified motorbikes, and I'm quite happy with that, but when the guy was running trough all the details he mentioned that the insurer was Equity Red Star!

 

So, now i'm going to get a bill for the cancellation of my insurance with Benntts, which I'm very disinclined to pay.

 

It just seems all very unfair to me and I was hoping for some advice here. Would a word to trading standards be worthwhile?

 

Dave

[clio2010]

hi sorry to thread hijack but im dealing with dial direct/axa which i have decided to try and claim back my cancellation fee for my moped insurance