Car Insurance cancellation charges??

Byteman_2

I automatically renewed by car ins policy with Hasting Direct in September, and I changed car in October I informed Hastings Direct, my premiums went upto £90 a month for a car I paid £700 pounds for.

So today I was thinking Im nearly 45yrs old, I have one years no claims, I think Im being ripped of here. So I went on Money Supermarket and founf the same cover form Swift Cover for £37 per month. So I rang Hastings Direct and told them I was thinking of cancelling my policy, could they do me a better deal, No! they couldnt, so I said I may cancel my policy after the next direct debit, and I was told I would have to pay a cancelation fee of £452!

What are my rights here can I cancel my DD and go elsewhere, why do I have to pay such a huge cancellation fee, when they would no longer be providing me with cover, what a rip off?

Cheers

Paul

Quentin

You can cancel your DD, but this won't cancel your contract with them or prevent them pursuing you for their money.

Ask them to itemise the £452 they are demanding to let you cancel. (If you have any add ons, they won't be refundable, there will be a cancellation fee and an early redemption penalty on the loan you have to enable you to pay in instalments, and there will be some premium to pay too etc)

dunstonh

I was told I would have to pay a cancelation fee of £452!

I doubt you were told that. I suspect you are combining cancellation fee and oustanding premium to the next cancellation point.

What are my rights here can I cancel my DD and go elsewhere

You entered into an annual contract and want to break that contract early in the term. If you cancel the D/D you will go into arrears as you have used a credit agreement to pay monthly. This will then see your credit record damaged and you still end up having to pay it when ultimately they take you to court and win.

why do I have to pay such a huge cancellation fee, when they would no longer be providing me with cover, what a rip off?

1 - its not a rip off. Its you misunderstanding what you are paying
2 - you are suffering more as you are only just over one month into the term which is when you suffer higher premium cancellation rates
3 - if you have ancillary products (such as AA or RAC or legal expenses cover then these are not refunded and as you have borrowed money to pay them you have to pay the money you owe).

If you ask them for a breakdown its probably around £25-£50 as a cancellation fee and the rest in premium and ancillary product costs.

Byteman_2

I was told If I decided to cancle my policy on 11th Dec, the end of my policy month, I would have to pay my DD of £90 on 21/11 and charges of £452 to get out of my policy.

Admittedly there is recovery on the policy, which was around £50 for the year. My credit record is v.poor anyway so I may just cancel the DD, inform them in writing I no longer require cover from them, and go with the cheaper provider and be £53 per month better off?

Quentin

It's not just your credit rating that would be affected:

Apart from them pursuing you for their money, (which means involving debt collection agency/court action/bailiffs etc), they will blacklist you which will make it difficult to get insurance by instalments in future.

Your new policy would work out more expensive than you plan (you would have no NCD to transfer).

custardy

this is your own fault for not getting a quote before you changed cars
pay the fees or keep your policy