£980 posst office car insurance cancelation fee!!!!!!

kentlad2

I was with post office car insurance my policy was renewed in january i then lost my job last month so i rang them to inform them i would be unable to make the monthly payment off £276.They informed me there was nothing they could do so i put my car up for sale and asked how much it would be to cancel the policy they informed me there would be a fee off £980 if i wanted to cancel the policy that is ridiculous in my eyes £25 -£50 ok but that much surely there is somthing i can do.so in the end i couldnt make the paymnet so i recieved a letter saying that THEY were going to cancel my policy not me.
1. does them cancelling it make any difference to the fee
2. can they charge that much as a fee.

Many thanx

dacouch

It depends what it says in their Terms and Conditions which should/would have been available for you to read when you took cover out. It would be worth you asking to see these.

It also depends on what the Insurer BISL who the Post Office use for their Insurance place you with (They are an intermediary).

It is not unsual for the Insurer to retain 30% of the entire premium for the first months premium, 40% for the second month and so on. In addition BISL probably have a fee for you cancelling and they will also probably deduct their commission (Between 10% and 20%) from the refund the Insurer send back.

If they invoke cancellation due to non payment they can use the same charges etc.

Your best bet is to ask for their Terms and Conditions and go through them and see if the charges tally with what they are telling you.

Which Insurance company is it with?

FlameCloud

Have you made a claim on the current policy?

roddydogs

£276 PM? blimy!

kentlad2

roddydogs wrote: »

£276 PM? blimy!

i no lol was a high performance sports car and im only 20

kentlad2

roddydogs wrote: »

£276 PM? blimy!

nope no claims i was in my second year with the company no claims always paid on time etc but when i lost my job they didnt want to help at all cudnt even freeze the policy until i had found a new car

kentlad2

dacouch wrote: »

It depends what it says in their Terms and Conditions which should/would have been available for you to read when you took cover out. It would be worth you asking to see these.

It also depends on what the Insurer BISL who the Post Office use for their Insurance place you with (They are an intermediary).

It is not unsual for the Insurer to retain 30% of the entire premium for the first months premium, 40% for the second month and so on. In addition BISL probably have a fee for you cancelling and they will also probably deduct their commission (Between 10% and 20%) from the refund the Insurer send back.

If they invoke cancellation due to non payment they can use the same charges etc.

Your best bet is to ask for their Terms and Conditions and go through them and see if the charges tally with what they are telling you.

Which Insurance company is it with?

BISL POST OFFICE

bob_a_builder

You might want to add your cacellation fee to this list to warn others off

http://forums.moneysavingexpert.com/showthread.html?t=893319

or use the numbers on there to enquire why the PO charge what they do ( because they can - I know but ....)

dunstonh

You might want to add your cacellation fee to this list to warn others off

Its not a fee. The OP is confused.

they informed me there would be a fee off £980 if i wanted to cancel the policy that is ridiculous in my eyes £25 -£50 ok but that much surely there is somthing i can do.so in the end i couldnt make the paymnet so i recieved a letter saying that THEY were going to cancel my policy not me.

When you pay monthly you are actually taking out a credit contract that pays the insurer for the annual cost. You then pay monthly. However, the cost of the insurance over the 12 months is not pro rata with the direct debit.

So, for example, if you cancel after 3 months you may be liable for 5 months worth of cover plus a typical cancellation charge of £25-£50. You may have only paid the equivalent of 2 months direct debit at that point so you are effectively in arrears at the point of cancellation and have to make up the difference.

Its quite normal for people that pay monthly and cancel mid term to have to pay much more to bring themselves up to date with the cost of insurance.

kentlad2

dunstonh wrote: »

Its not a fee. The OP is confused.



When you pay monthly you are actually taking out a credit contract that pays the insurer for the annual cost. You then pay monthly. However, the cost of the insurance over the 12 months is not pro rata with the direct debit.

So, for example, if you cancel after 3 months you may be liable for 5 months worth of cover plus a typical cancellation charge of £25-£50. You may have only paid the equivalent of 2 months direct debit at that point so you are effectively in arrears at the point of cancellation and have to make up the difference.

Its quite normal for people that pay monthly and cancel mid term to have to pay much more to bring themselves up to date with the cost of insurance.

thanx mate whatever happens i dont have that type of money i am on jobseekers currently £40 a week and outta that i have to pay other bills etc and survive so i dont no what i am going to do

dacouch

kentlad2 wrote: »

BISL POST OFFICE

BISL are not an Insurance company they are a broker / intermediary