Vehicle insurance after bankruptcy

YamahaR6

I was chatting to my aunty earlier who is a social worker in Notts. She helps a lot of her clients through the bankruptcy process so I was talking to her about the ins and outs of what may or may not happen to me. The one thing she did mention which worries me slightly is that once I've been made bankrupt my vehicle insurance policies will be cancelled (I currently pay monthly) and that I'll have to pay them as a lump sum. This won't be possible straight away as I'll need to save an amount each month before I can pay a lump sum! Does this mean I could potentially be unable to use my car for a year after bankruptcy? Anybody else had any issues with monthly paid insurance policies after bankruptcy?

Han

Costus

Hi Yamaha, just check the terms and conditions of your policy and see if there are any clauses regarding BR. Even ring the insurance company up incognito if you want, and ask them if they have any restrictions regarding BR customers.

What happened to me was i checked my terms and conditions, couldn't find anything relating to BR, carried on paying my monthly direct debit as usual and even renewed my policy with them and it was a pretty good renewal quote.

Hope this helps.

peachyprice

Yamaha, I think that the exeption rather than the rule, and certainly isn't something that happens automatically. Very few people here have had trouble with car insurance.

We had 2 cars insured throughout BR, neither policies were cancelled, we continued to pay in installments and made a claim on one of them in that time.

The only problem I had was wanting to change to co-op insurance just after I was discharged, they wouldn't let me pay in installments, even though they would with my home insurance so I carried on with the AA, I'll try again next year though.

markbass

Well i pay monthly and mine was fine after BR.

So_Sad_Angel

I changed to the AA recently. When I asked ( just in passing conversation ) about that clause (Im not BR yet) they said that I would be required to pay the remainder of the premium as a lump sum whereas now I pay instalments. Something about the credit agreement, that is in place for the direct debit, will be cancelled.

Worried me a bit but what can I do....I guess its wait & see.

skylight

Not a problem with any of my insurers.

Although - Shelias Wheels appear to have changed. It never used to be on their policy but on this years renewal it does state that they will cancel the agreement if I "commit an act of Bankruptcy". Being discharged it no longer affects me, but I would read the small print on all policies (or Ctrl F to search the page!) for bankrupt and insolvent. Plus call them to ask.

the-muffin-man

I'm with the NFU and I pay by monthly DD - I informed them when I went bankrupt and they weren't concerned about it and everything has carried on as before.

YamahaR6

Thanks for the responses I've checked, double checked and triple checked my terms and conditions and there's nothing about insolvency/bankruptcy anywhere so fingers crossed it'll all be ok. I'll certainly take peoples advice about phoning anonymously too just to quadruple check!

the-muffin-man

Just to add my wife works in insurance and she said to me that going bankrupt would be regarded as a 'material fact'. So if you don't declare it and you have a crash it could give them reason wriggle out of the policy and not pay out.

rog2

the-muffin-man wrote: »

Just to add my wife works in insurance and she said to me that going bankrupt would be regarded as a 'material fact'. So if you don't declare it and you have a crash it could give them reason wriggle out of the policy and not pay out.

I think that that sentence would be more correct if the word 'would' was replaced with 'could', as there is so much discrepancy regarding bankruptcy and car insurance.

It is a subject which is often debated on this board, and the aspect of 'material fact' was openly discussed, recently, on the following thread:

http://forums.moneysavingexpert.com/showthread.html?t=1663843

There was no definitive conclusion to the very real question that the OP has posed. My own, and I stress that it is my own, opinion is that 'if asked specifically' any bankrupt, whether discharged or not, should declare the fact that he/she has been declared bankrupt. However, if there is no reference to bankruptcy in the application terms, then why 'volunteer' the information?

boltonangel

I was declared BR back in June and hadn't even thought to inform my insurance company. I am due to renew in September and have just had a really good quote from Directline, but can't pay upfront.
I am the main driver, but my dh (not br) is a named driver. Do you think they'd let the credit agreement go in his name rather than mine so that I can pay monthly?