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Cancelled Car Insurance
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# 1
jrusso
Old 21-07-2011, 8:21 PM
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Default Cancelled Car Insurance

Got my renewal quote through today and thought I should give them a call to declare some points that were added recently.

Last year a direct debit bounced for my car insurance. I was living away from home on a temporary basis - i.e. away on business and didn't get the letter advising me of this.

My insurer (The Co-op) then allowed the policy to lapse and I was quite swiftly picked up by the police. After some to-ing and froing the Co-op refused to back down and a few months ago I got a fixed penalty fine and 6 points.

In the meantime I re-insured with a different company. They are saying that the lapse in the policy means that I need to answer yes to having had insurance cancelled.

Surely a lapse due to non-payment is different from insurance being cancelled for fraud or whatever?

I've to wait for an answer from the underwriter tomorrow, but I notice doing a quick online search that if you answer yes it's essentially impossible to even get a quote.
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# 2
Spiderham
Old 21-07-2011, 8:32 PM
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Quote:
Originally Posted by jrusso View Post
Surely a lapse due to non-payment is different from insurance being cancelled for fraud or whatever?
Unfortunately not, your policy would have been cancelled for non-payment not lapsed, meaning you do have to declare cancellation.

Lapsing is not renewing at the end of the 12 month period of the insurance, ie there is no cancellation and the policy is simply not renewed thus bringing an end to the relationship between insured and insurer.

If the policy is brought to a halt during the 12 month period of insurance that means it must have been cancelled by one of the two parties. If cancelled by insured for whatever reason (cheaper deal, no longer have car etc.) no need to declare. The question will ask if you've ever had insurance cancelled by the insurer which in your case you have it seems.

Sorry to bring bad news, but that does seem to be the way it is from what you said.
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# 3
jrusso
Old 21-07-2011, 8:36 PM
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So because I missed a DD I basically can't be insured? Hardly seems fair.
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# 4
BoGoF
Old 21-07-2011, 8:41 PM
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Is it fair you didn't pay your insurance...

You policy was cancelled because you didn't adhere to the agreed terms......
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# 5
dunstonh
Old 21-07-2011, 8:49 PM
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Quote:
They are saying that the lapse in the policy means that I need to answer yes to having had insurance cancelled.
It didnt lapse. It was cancelled due to non payment.

Quote:
I notice doing a quick online search that if you answer yes it's essentially impossible to even get a quote.
Correct. Internet tends to cherry pick the easy stuff. It will be a trip to your local broker just like the old days.

Quote:
So because I missed a DD I basically can't be insured? Hardly seems fair.
Its not just a missed direct debit though. You must have ignored correspondence and had the second attempt bounced and never paid the missing payments by cheque to make it up.
I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
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# 6
Spiderham
Old 21-07-2011, 9:09 PM
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Quote:
Originally Posted by jrusso View Post
So because I missed a DD I basically can't be insured? Hardly seems fair.
The insurance is a contract where you agree to pay a premium and in return the insurance company agree to pay for claims you have. As you failed to pay the agreed credit arrangement for the premium (as that is what the DD is), you got the policy cancelled.

Now from this insurers are generally (unluckily for you) going to perceive you as higher risk to insure and therefore either not bother or be after a higher premium. The reason is that having failed to honour your side of a contract before they see a greater risk of you doing it in future. It may also be perceived as a bit reckless (strong term I know and I mean know offence, it just links in well for insurance purposes) to allow the DD to go unpaid despite reminder letters (which you unfortunately seem to have never seen being out of the country). Insurers will be worried you show a similar level of "recklessness" with other things so see that as higher risk also (what's known as a moral hazard in insurance jargon).

None of the above is meant in a disparaging way, just trying to show it from insurers' perspectives, I know sometimes things can come across as harsh on forums.

All the best getting it sorted.
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# 7
jrusso
Old 22-07-2011, 5:07 PM
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Thanks to everyone for their help on this.

Thankfully, my insurer (NFU Mutual) having referred the case to an underwriter are happy to renew the policy with an additional fee based on the points and IN10 code.

I'm wondering if I'm now stuck with them for ever (?) but TBH they seem helpful and friendly and the price quoted is lower than came back when I did a money supermarket search.
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