Cancelling my car insurance policy after an accident

billdrick

After having a road accident that wasnt my fault, my car was written off by the third party's insurance. I was offered £300 which I accept was the value of the car pre-accident. Although I accept this, I am unable to afford another car so I will need my car insurance cancelled.

I called my insurance company today. They tell me I may have to pay the rest of my policy which amounts to £550. They've said they will wait until 2nd February for the third party's insurance to pay this, but if they don't it will fall to me to pay it straight away.

Does this sound right? Should I have to pay the rest of my policy if none of this is my fault?

dunstonh

Does this sound right?

yes

Should I have to pay the rest of my policy if none of this is my fault?

You pay for 12 months. If you use a credit agreement to pay monthly then you take the risk of having to pay more afterwards.

Most insurers will allow you to transfer the policy to your new vehicle though so you shouldnt lose out there.

dogbot

The OP said that they can't afford another car now though.

If the other party is at fault, then hopefully they will provide you with payment for the rest of the policy charge.

You will probably be able to agree to pay the amount over time rather than in 1 lump with your insurer anyway.

You might want to check with the insurer though, do they mean that if they recover their outlay, then you won't be liable for the full cost of the year's policy, and could cancel under their normal mid term cancelation structure?

Worth a try if the third party is at fault since the third party insurer might refuse to cover the cost of your policy - you entered the insurance contract before the accident and so they might argue the two are not related and you owed that financial liability regardless. As DA says, you took on that liability.

TighterThanTwoCoatsOfPain

dunstonh wrote: »

yes



You pay for 12 months. If you use a credit agreement to pay monthly then you take the risk of having to pay more afterwards.

Most insurers will allow you to transfer the policy to your new vehicle though so you shouldnt lose out there.

Hmmmm very unusually I dont necessarily agree its as cut and dried as this..

Whilst I'd agree if they had claimed on the policy, I have never had any issue cancelling a policy mid term and receiving a partial refund - subject to some sort of weighting in the favour of the insurer, but a refund non the less...

OP - Its likely that they are taking this stance as the claim is currently ongoing and they aren't yet sure they wont have to make some sort of payout ??

dunstonh

Whilst I'd agree if they had claimed on the policy, I have never had any issue cancelling a policy mid term and receiving a partial refund - subject to some sort of weighting in the favour of the insurer, but a refund non the less...

As it currently stands, he has claimed on the policy. The other insurer hasnt taken the liability yet.

TighterThanTwoCoatsOfPain

Yeah thats what i suspected at the bottom of my post.. however i'd initially read it as if the other parties insurance had offered the payout..

I guess we'll know more if the OP ever re-appears!

Ian_W

billdrick wrote: »

After having a road accident that wasnt my fault, my car was written off by the third party's insurance. I was offered £300 which I accept was the value of the car pre-accident.

How can the other party's insurer write-off the car unless they are accepting liability?

billdrick

Sorry for bringing this back up again, but I ended up having to pay the rest of the policy in one go. They gave me a couple of weeks to pay the full £550 or whatever it was.

I still don't quite understand it all, but I've not been able to afford another car. It's especially bad for me as I have agoraphobia/social anxiety, so relied on the car quite heavily for myself and my disabled father. The reason you pay monthly is because you can't afford it in one go, so it seems a little backward that people who pay in full can usually get a refund, whereas people who can't afford it have to pay the rest (if what I've read above is correct). Seems unfair, but that's life I guess!

Everyone I have spoken to says it's wrong and I should be able to do something, but to be honest I'm glad it's all over, I'm getting use to a new way of life without a car.

billdrick

Ian_W wrote: »

How can the other party's insurer write-off the car unless they are accepting liability?

The third party did accept liability.

dunstonh

he reason you pay monthly is because you can't afford it in one go, so it seems a little backward that people who pay in full can usually get a refund, whereas people who can't afford it have to pay the rest (if what I've read above is correct). Seems unfair, but that's life I guess!

That is not correct. If you pay as a single payment or monthly the same happens if you have a total loss.

The exception is where you continue to insure the new vehicle and it can continue.

Everyone I have spoken to says it's wrong and I should be able to do something

They are wrong.

StanVanDamn

Billdrick you should never have had to pay the whole policy. Let me give you an example to make it simple...

Say you take insurance from January 2009 to January 2010 and you pay for it monthly. In June 2009 you sell your car - you should not have to pay the rest of the monthly payments for the insurance for the year as you are not using the insurance policy any longer.

HOWEVER, if we use the same scenario again, and there was a claim against your insurance company in March 2009. If you sell your car in June 2009 - your insurance company are entitled to ask for the remaining payments until January 2010. You have agreed a year contract and the insurance company have fulfilled their contract by paying out on the claim.

This makes me think, in your situation, that the claims department in your insurance company still have the claim open thinking they could potentially have to pay for the other persons claims. I would definitely ring them up and check on this.

If you need any further information please email me on [EMAIL="stanvandamn@hotmail.com"]stanvandamn@hotmail.com[/EMAIL].