Towergate Ins, what a rip off !!!

homedad

hi first time poster but long time reader of this wonderful site.

My inlaws have recently moved into extra care housing, so while the old house was empty we needed buildings ins on it until it was sold. Their existing ins co wouldn't cover empty houses so they recomended Towergate Ins.
My sis -in -law arranged a policy to start on 1st Nov, wasnt cheap but she didnt bother to shop around, she specifically said we would cancel it once the house is sold, and was told thats fine, there will be no cancellation fee.

Well the house sold real quick so we cancelled the policy before it even started, but they have now recieved a bill for over £300, £200 for half the policy charge and £100 admin fee, so much for no cancellation charges!!!
Sis-in-law rang to complain and they wouldn't budge, she reported it to ombudsman who said pay the bill and then make a complaint. Seems the wrong way round to me, i wouldnt have paid it.

any advice or anyone else had deaings with this awful company?

dunstonh

Well the house sold real quick so we cancelled the policy before it even started, but they have now recieved a bill for over £300, £200 for half the policy charge and £100 admin fee, so much for no cancellation charges!!!

If she used a broker then this could be a mis-sale. However, given that a complaint has been made and rejected and even the FOS have rejected it suggests there is more to the story than you are telling us.


edit: misread the comment about the FOS. Hence response is not quite right. She should refer it to the FOS after paying.

InsideInsurance

TBH sounds more like there have been a couple of quick calls and not following the formal complaint route.

Did you buy direct or through a broker? Who ever you actually bought through you need to put in a formal complaint that you were explicitly told that there was no cancellation charges etc prior to agreeing to buy and thus you are disputing the charges they are now trying to apply.

mikey72

Even if you hadn't been told there were no charges, cancellation should be pro rata for time on cover, ie no premium payable, and up to £50 cancellation fee.

http://www.financial-ombudsman.org.uk/publications/ombudsman-news/54/insurance.htm

so raie a complaint with the insurer, and refer it to the FOS if they do not refund.

homedad

After i got involved today to try and sort things out, it seems that between my wife and her sister they have managed to get their wires crossed.

The policy didnt start on 1st Nov, but 23rd Sept. 1st nov was just the 1st payment day. My wife cancelled it on 21st Oct based on the info from her sister that the policy hadn't started yet and so no costs incurred, but instead it incurred a fee of £312, a little excessive on a policy costing £470, and quite a lot for 1 months cover i think you will agree.

In order to get some value out of the money paid i have re-instated the policy today, at least until the property is actually officially sold, its is currently in the process of being bought.

Turns out the way they calculate premiums if you cancel is to charge prorata for the days you have used, then charge half the daily charge for every day remaining on the policy, plus the obligitory £50 admin fee. So you end up paying for the days you have used plus the days you havent. Nice work if you can get it.
Still not happy with Towergate, or sis-in-law for getting such a crap deal in the first place

dunstonh

Turns out the way they calculate premiums if you cancel is to charge prorata for the days you have used, then charge half the daily charge for every day remaining on the policy, plus the obligitory £50 admin fee. So you end up paying for the days you have used plus the days you havent. Nice work if you can get it.
Still not happy with Towergate, or sis-in-law for getting such a crap deal in the first place

Still complain as that is typically higher than what the FOS would normally consider fair. They are happy with the admin charge at £50 but expect the premium to be relatively pro-rata (with allowance for a sightly higher amount near the start to cover the fact that virtually all the cost is at the start)

homedad

Update and a bit of a result.

Ombudsman put complaint to Towergate that the original call to them to take out policy gave incorrect cancellation charges if/when house is sold. Towergate went back and listened to the original phone call and admitted that it "fell below their usual standards". So they agreed that when/if we cancel the policy, when house is sold, they will only charge prorata for the days we have used + £40admin charge, waiving the charge at half prorata for the unused days.

I think they realised that if it went to the ombudsman they would lose as their charges for cancellation are unfair.

thanks for the help :T

InsideInsurance

The problem is it doesnt matter if they win or lose they still have to pay the ombudsman fee which is significantly more than the £200 of fees they've been trying to charge you.

Whilst some companies will stick to their guns and go for the "moral" victory others will settle complaints on a commercial basis even though they believe they would win

McKneff

Ombudsman fee is or was the last time I heard £500, thats maybe why they backed down a bit.