Company keeping credit/debit card details

poor_child

I am not sure if this thread is in the correct section, I apologise if it's not and hope that it can be directed to the correct section.

I was wondering if anyone knows the legality regarding keeping hold of customers credit or debit card details?

The situation is that we've bought car insurance off Kwik Fit last year. Paid for the premium in full with a debit card and have been insured with them for 12 months.

They wrote to us in early December to advise that our insurance was due on 01/01/11 and that they had found us a competitive quote of near £1k. Looking at that, I knew we had to shop around since we only paid £600 the year before and had made no claims.

Hence knowing what our renewal now was, we shopped around and found a rate £500 cheaper than KF. So we've gone with another company. However, unbeknown to us KF have charged us near to £1k on our debit card in the new year because we did not call them to tell them to decline their renewal offer.

They have refunded the money they took out of the account now. But since such a large sum came out without our knowledge, we have not been able to pay our direct debits and gone over our over draft limit and have incurred a charge of £5 per day for going over OD limit since 01/01 and £5 charge for every direct debit that has not been able to process. The cost to us is approx £75 since all our direct debits are due at the beginning of the month.

I spoke to KF and told them that it was outrageous for them to do this as I did not authorise for them to hold my data or take that money out, they advised that they can keep our card details and process funds by writing to us and inform that they are doing so. We got a letter on the 15th which stated that they would process amount from said debit card on 01/01/2011. I have to admit that we overlooked this letter with the rush of Christmas and that we had decided not to take their offer up. In all the years that we have bought insurance we have always paid upfront and then had the choice to consider their offer at the end of the 12 months but there was no condition to buy.

Does anyone know the legal stance on this?

Thanks

pcombo

we did not call them to tell them to decline their renewal offer

Why! If you made the 5-10 minute call you wouldn't be having all these issues, If i am right in saying companies can keep your information for up to 6 years.

poor_child

pcombo wrote: »

Why! If you made the 5-10 minute call you wouldn't be having all these issues.

In hindsight yes of course, I will not be missing that courteous call again. However, I have been buying insurance for 5 years and before this I've seen my parents etc sort theirs and I've always known the current insurer coming back with a renewal offer but not to then go ahead and just renew it for you!

pcombo

If i was you i would check the original forms they sent and the terms, I sure it will have auto renew somewhere.

Infact.

"Your policy may automatically renew. We will tell you if this is the case on the renewal invitation letter that we will send you a few weeks before your renewal date. You can also contact our Renewals department on 0800 027 6670 and a member of our dedicated staff will be happy to help. Alternatively you can also renew online by clicking here"

Floxxie

It's a recurring transaction. Check your original agreement and there will be a clause in there that will give the details about holding onto your card details.

TBH if you had decided to remain with the insurer, which lots of people do, you would have been glad that you didn't need to do anything to renew.

And yes information can be held as long as it is in a secure manner.

sarahjayne1977

i think a lot of insurance companys now put you on automatic renewals it does state on bottom of your letter though telling you are..but all it takes is a call to tell them to take you off it.
directline do the same but i told them i don't want it on automatic renewel and been took off its a easy simple thing to do..be aware who you are now insuranced with will prob done the same so bear this in mind next year when insurance is due

shortchanged_2

To my knowledge most car insurance companies I know have an automatic renewal system in order to provide continuing insurance and it is up to you to cancel the renewal.

It's actually quite a good safety mechanism in case some people forget to renew their insurance.

poor_child

Thank you all for the response.

I guess it's a lesson learnt then I've most likely been lucky enough (IMO!) to have escaped the insurance companies that do this thus far.

sarahjayne1977

be aware its not just car insurance companys which are doing it but also home insurance companys just so you know x

Freddie_Snowbits

AS I am aware, car insurance normall automatically renews, this is so that the insured driver keeps their insurance. You are sent emails and renewal forms well in advance of the renewal date and it is down to YOU to decline their offer and shop elsewhere.

As for keeping details, well iTunes, Amazon, HMC, Tesco do to name but a few. If OP has a problem, then do not shop on line, pay everything in cash.

fluffnutter

It's called continuous payment authority and it's perfectly legal provided you're advised in good time that the payment will be taken. Which Kwikfit appeared to do. However, like you, others aren't aware of this type of auto-renewal and there are many, many complaints about it. Be vigilant seems to be the advice and make sure you cancel policies properly, i.e. not just let them lapse.