Direct line want £180 to cancel car insurance within the 14 days!?

sophie131

Hiya! We recently took out car insurance with Direct line and paid the full £1800 straight away (well my Mum did!) anyway, I then found it much cheaper (£800) so we cancelled the Directline policy the day after we had taken it out. We sent all the documents back straight away and as far as we were aware we would get our full insurance premium back (all be it minus a smallish amount!).
Today we got a letter asking for the admin charge ASWELL as a months premium (which is quite a lot considering the price we paid!). Is this right? On our policy documents it says:

If this cover does not meet your requirements, please return all
your documents within 14 days of receipt to the address shown on
your insurance certificate. We will return any premium paid in full
provided no claims have been made on the policy during that time.
The full annual premium is due if a claim has been made during

that period.

Thanks for any help!

greco_2

In what way did the cover not meet your requirements?

deanos

greco wrote: »

In what way did the cover not meet your requirements?

Probably a £1000 worth

MarkyMarkD

Direct Line's terms and conditions are a mess, and consequently not enforceable.

Assuming that you bought online, they have three different cancellation terms.

Car Policy Document

The Car Policy Document states that they will "return any unused premium less the cancellation rates shown in the schedule".

Car Policy Summary

The Car Policy Summary states exactly the wording you stated - i.e. that cancellation within 14 days will earn a full refund if you have not claimed.

Important Information Leaflet

This document has swingeing cancellation terms. It states that a pro-rata refund will be given, less a cancellation charge equal to 50% of the annual premium.


Now, obviously you've got off lightly compared to the worst of those three sets of terms. But because they all conflict with each other, there's no way they can enforce anything other than the most generous i.e. the one you quoted.

Contact them in writing, with a copy of the clause you quoted in your original post, and asking them to comply with the terms & conditions they defined and to which you agreed when you took out the policy.

If they continue faffing about, tell them you will refer the matter to the Financial Ombudsman Service.

Ian_W

I agree with MarkyMarkD and as Direct Line only operate by phone or internet this
on the Citizen's Advice website may also be of interest:

Cancelling your insurance policy
You may want to cancel an insurance policy if you have just bought it and have changed your mind. You have a right to do this if you bought your policy over the phone, on the internet, or from someone who called at your home or place of work... Many general insurance policies give you an automatic right to cancel within 14 days of purchase ... etc.

There is nothing in the clause you quoted that says you have to give a reason WHY the policy didn't meet your requirements, so don't give a reason, just tell them it didn't and they're stuffed!

MarkyMarkD

Financial services are exempt from the distance selling regulations, so I'm not sure what legal basis there is for requiring insurers to let you cancel. The same website you quote states

Your insurer is allowed to make a small charge for the administration costs of cancellation, but they are not allowed to make a profit from this charge.

but once again I don't know the legal basis for this.

zkw29

I'd give them a phone and explain. Its possible its been cancelled from the date they processed your letter and not the date you sent it. Just mention it was sent within the 14 day cooling off period.

My advice to anyone else wanting to cancel a policy within the cooling off period is to phone and tell them as well as returning the certificate - then there is a recording of your request and theres no problems with things getting delayed / lost in the post.

zkw29

MarkyMarkD wrote: »

Important Information Leaflet

This document has swingeing cancellation terms. It states that a pro-rata refund will be given, less a cancellation charge equal to 50% of the annual premium.

That's for their breakdown policy - not for the insurance.