MSE News: Consumers urged to fight rising insurance admin fees

olly300

afwone wrote: »

In my experience it is not easy to find information on charges imposed by insurance companies, though it may be buried away somewhere in the small print that one has to agree to.

I've never had a problem finding out these admin fees. If it's not apparent in the small print you can always ring them up and ask BEFORE you buy the policy to find the maximum they will charge.

I have therefore managed to avoid companies that charge £50 simply by paying something like £10 more to go with a different insurer who charges less.

The most I've actually paid is £20 but that was in a year I did 2 other changes where the admin charge was £0.

lisacblue

My hubby was with a motorbike insurance firm for years. He agreed with them to renew which starts on sept 7th. But a week ago was offered insurance from another firm for half the price. Because of this he is being charged to cancell insurance that hasn't even started and are already threatening him with debt collectors. Thay say cancelling before his renewal date incurs a charge, but he's not cancelling before the renewal, he just doesn't want to renew. Can they still do this? Can anyone point me in the right direction to help fight this.

dunstonh

lisacblue wrote: »

My hubby was with a motorbike insurance firm for years. He agreed with them to renew which starts on sept 7th. But a week ago was offered insurance from another firm for half the price. Because of this he is being charged to cancell insurance that hasn't even started and are already threatening him with debt collectors. Thay say cancelling before his renewal date incurs a charge, but he's not cancelling before the renewal, he just doesn't want to renew. Can they still do this? Can anyone point me in the right direction to help fight this.

If you told then that he wanted to renew and then later changed his mind then he is subject to a cancellation charge as they would have done work based on his initial response.

If he hadnt told them first that he wanted to renew then they would not charge as the would have been waiting for him to tell them.

Answer is yes, they can do it because he gave his instruction previously.

house_mum

Just about to try to get through to complaints dept for ESure on the topic of ridiculous cancellation fees. Buying a new car, I thought I'd timed it perfectly - getting rid of old one just before tax/mot/insurance due. Called this morning, to say that I would be cancelling in just under a month, and I presumed this was OK as my insurance is paid in full to the end of the month, to be told there was a £55 admin fee! My monthly insurance instalments (I know, not the most sensible way to buy insurance but we had to do it this year) were only £28 - I explained I was not trying to get any form of refund, and have paid to the end of the contract so why do they need any more money, but had no sensible response. Off to call again to try to get a sensible answer...
(Even worse, I asked why £55 as I thought they charged £27, to be told it was because it was the first year of my policy. I've been with them 2 years, but because last time I shopped around, then called to get them to reduce the renewal quote, this counts as a new policy - watch out for that one!)

dunstonh

to be told there was a £55 admin fee!

It is at the higher end of the scale but it is published and its within what is considered fair.

My monthly insurance instalments (I know, not the most sensible way to buy insurance but we had to do it this year) were only £28

irrelevant. Explicit charges are designed to be the same for everyone irrespective of the premium paid. You seem to want people paying higher premiums to have higher admin charges. That would be unfair.

house_mum

My point was that I will have paid a full year of insurance, I will be cancelling 2 weeks before the end of the term.
Also, the fact that calling them to negotiate your renewal fee means that you are counted as a new customer, even though you may have been with them for years, instantly doubling the cancellation fee amount. (I had read my terms and conditions, and assumed the maximum I would be charged was £27 as I thought I had been a customer for more than a year having renewed my previous year's policy with them).
I was not trying to say that people paying higher premiums should pay more. You are right, it is an irrelevant fact.

dunstonh

My point was that I will have paid a full year of insurance, I will be cancelling 2 weeks before the end of the term.

Frustrating. The best thing to do is let it carry on until the end and not try and cancel it.

Ninja636

MSE_Guy wrote: »

This is the discussion thread for the following MSE News Story:

"Some firms charge £110 to cancel a policy yet critics have questioned whether this reflects the true cost to a company ..."

I recently contacted the Policy Shop asking them to substantiate their £70 admin charge , the reply I got staggered me ......
" Well we don't make much commission on these policies so we bump the admin fees up ".
I enquired further....... "So you don't actually do anything extra for this" ? .......
"Err no not really" .
I confirmed this amazingly up front and honest admission and asked the operator ( Chris) if he considered this to be right and fair
He replied " Well we've got to make money somehow"

I don't know what has stunned me more the arrogance or the stupidity.
But i do know it's about time that the regulators got a grip of pirates such as these.

ridgey28

I have recently been charged £50 for cancelling a car insurance policy within an hour of taking it out!

My partner had asked me to get some van insurance for him not realising that his previous insurance policy had continued his policy and had already took the payment out. Do I stand a chance of getting any money back if I complain? Any help would be gratefully appreciated.

missminx

I think there are 2 discussions going on here. The fact they impose charges at all, and the argument that some companies charges are excessive compared to others.
I think excessive admin charges, for making a simple cahnge such as address are very unfair when companies do not provide for you to do it yourself online. It's 2 minutes of an adviser's time on the phone. They are not paid enough to warrant charges of £30+ in amin fees!
They are taking the mick. Insurance is increasing every year. We insured our car in April. I did a quote comparison just now with all the same details and the quote has jumped by more than £50. I dread to think what next April will bring.