Close premium finance shocker

Hi there

You're clearly annoyed here and I can see why but bear with me and I might shed some light.
Close Premium Finance (CPF) is a highly reputable company and the market leader in providing finance for insurance policies. They are backed by a respectable, well funded and stable parent - Close Brothers. They are used by the majority of insurance brokers in the market who want to offer their customers an easy and affordable way to pay for their insurance requirements.
To make the renewal process easy, your broker is able to renew your credit facility on a rolling basis as your insurance falls due each year. Most often, one facilitates this by signing a Running Account Credit Agreement.
It seems that you've been a victim of a timing issue rather than any fault on the part of the broker or CPF. CPF will have retained your direct debit details as part of the credit agreement on the assumption of renewal. Unfortunately, when your broker submitted your new policy for finance you had cancelled the direct debit so when CPF called for the initial instalment it was rejected by your bank. Because of the large volumes of business handled by CPF they will have a significant amount of automation built into their accounting and operational processes and this will have resulted in a letter being sent to you telling you that you were in default. There is a significant cost to businesses of all types in the UK in handling customer defaults and in the majority of cases a charge is levvied to cover these costs and it is usually the policy to do no more than cover costs and not impose charges as a penalty (although it's fair to say that it's not always easy to see it this way).
In your case it appears that CPF have, quite reasonably on representation from you, waived the charges, allowed you to bring the account up to date and advised you what needed to be done to get things back on track (i.e. reinstate your direct debit).
Direct debit instructions are sent electronically so it is most likely that the instruction was sent from CPF's systems more or less immediately. However, CPF would have no control over the bank's handling of that instruction once they received it. In most cases one could reasonably expect the bank to have reinstated the direct debit by the end of the next working day. But there is always the possibility, as there is with any complex process, that your bank may not have been able to complete this activity in that timeframe.
I appreciate that it's frustrating, but you did the right thing by getting in touch and it seems, from my reading of your description of what CPF's people told you, that they did the right thing too.

Sorry if this is a bit wordy but I hope it helps some.

I took out private car insurance with Sureterm Direct on 16th April 10. We had looked at the vehicle on the internet and had arranged insurance in order to drive it home, however when we went to collect the vehicle it was ‘not as described’ and declined to buy it. Sureterm who had arranged the insurance, also had arranged finance with Close Premium Finance. We obviously cancelled the insurance. We purchased another vehicle on the 28th April 10 . (Some two weeks later) Surterm, again arranged the insurance , and advised us that a new direct debit would be arranged via Close Premium Finance, and new direct debit forms would be sent out.

This is when the problems started. Close Premium Finance, attempted to take out the direct debit on the 16th May 10, (this was on the first vehicle which had a separate account number) the direct debit had been cancelled along with the insurance. We assume that the brokers cancelled the direct debit because we had not.

Even though the 2nd vehicle was not purchased until the 28th April, (the request for the first lot of payments via direct payment should have been requested a month later on or about the 28th May) However I received a letter from Close Finance on the 19th May, stating that no payment had received, and that unless it was made by the 3rd of June they would take further action. They included a charge of £40.00 which said was for admin.
The payment totalling £70.88 was made within the specified time, but I received a letter dated 17th June 10, giving me notice of termination and threatening that my insurance may also be cancelled. – The reason given was that the payment had not been made. Close premium were contacted by telephone but said I had to contact the broker to resolve the matter, Close Premium were not interested when I tried to explain the fact that I had cancelled the first lot of insurance because I had not purchased the vehicle, but had gone on to buy an alternative vehicle, which was insured with the same broker, and financed by Close Premium (under a separate agreement number)
Close Premium Finance did concede that the payment they had requested for £70.88 had in fact been made , but then gave an alternative reason as to why the agreement had been terminated (because not direct debit had been set up) this was not mentioned anywhere in the letter.
The brokers Sureterm were contacted, they were very helpful and in fact rang Close Premium Finance whilst I was on the line, but they were given the same reason for the admin charges, that the payment had not been made on time. I have wasted a lot of time and money in telephone calls to Close Premium regarding this. The brokers have advised me that a new direct debit mandate would be sent out ( I wont hold my breath)

Re my message posted 28th April 2110. Everything sorted. Give Close premium finance theyre due, they followed everything with phone calls and letters and have sorted everything from changing the due date for the direct debits, to re-imbursing the £40.00 admin fee. Sureterm Insurance also were very helpful. Again credit where credits due. (Pardon the Pun) Paul Cascarina Head of Operations dealt with everything and was very helpful in this matter