Car Insurance - Early Termination

Grass-hopper

Hi all,

I have recently returned my car to the finance company using an early Voluntary Termination Agreement.



I had my insurance through One Call and looked at cancelling my insurance with them. As they now cannot do cancellations over the phone - I had to do it via the Website. I sent an enquiry on the 17 of Feb stating I was looking to cancel on the 1st March and could they inform me of the charges involved in doing so. I received a letter stating my insurance was cancelled as of the 17th of Feb and I owed £287. This was broken down as follows:

Premium started 25/6/2010
Cancelling 17/2/2011 - 8 months cover resulting in short change of 95%
Total Premium - 2111.85
Charge for time on cover - 2006.26
Amount paid - 1719.26 (deposit plus £206 per month)
Balance owed 287.16

I then paid a further monthly DD payment of £206 on 25th Feb

I rang them up to say they had made a mistake and I did not want my insurance cancelled until the 1st of March to which they said no problem - we will send out a new settlement figure letter which came through as follows:

Premium started 25/6/2010
Cancelling 1/3/2011 - 9 months cover resulting in short change of 100%
Total Premium - 2111.85
Charge for time on cover - 2111.85
Amount paid - 1719.26 (deposit plus £206 per month)
Balance owed 392.75

Firstly - I notice the have not taken into account the further £206 that was taken as a direct debit on 25th Feb.

Secondly - is this right? How can they get away with charging me the full amount right through to June this year - even though I cancelled it from today onwards? Do all insurers do this - do I have a leg to stand on here?

Any advice appreciated.

Quentin

Your policy should set out the termination conditions, so check there.

You will probably also have some early termination charge in respect of the instalments as well as a cancellation fee to pay.

kingstreet

Can you post the terms & conditions you were sent when you set up this contract? Cancellation terms vary from one company to another. For example, my cover says on cancellation I'm liable for a fee of £38 plus a percentage of the premium dependent on when in the policy year cancellation takes place.

Grass-hopper

http: //s2.postimage.org/yfh71z7rt/policy.jpg

It wont let me attach the image to the thread - so tried the above (put space between http and link address)

kingstreet

In month 9+, the full premium is payable, so they appear to be correct in setting 100% of the premium as the payable level. I would go back to them about the additional premium paid on 25 Feb, as this appears to have been missed.

The cancellation terms of my cover are worse. With 100% payable on month 7+. As I said, they vary from company to company.

You might like to have a look at this;-

https://forums.moneysavingexpert.com/discussion/893319

Grass-hopper

Total rip off - but looks like there is nothing I can about it. Great! :mad:

I'll make sure they account for the £206 thats came off.

Thanks for your input - it's appreciated.

forgotmyname

Sounds like you would have been better off just letting the insurance run its course. Extra year of no claims
and if you had driving other cars it may have come in useful some time.

Quentin

forgotmyname wrote: »

Sounds like you would have been better off just letting the insurance run its course. Extra year of no claims
and if you had driving other cars it may have come in useful some time.

There are problems over this.

Should your ex car be uninsured by a new owner and involved in an incident with a third party, then your cover could be used, and a claim registered against you leading to all sorts of financial consequences.

And driving other cars cover often has a condition saying you cannot use it if you no longer have your car (or it's been declared a write off).