car insurance cancellation fee

Lintama

I am incensed that I have to pay £26 cancellation fee.

I bought car insurance on the internet using my credit card and found out later that I could get a cheaper cover elsewhere. I phoned the company that I took the insurance with and they told me I would need to pay the cancellation fee. I am amazed at this as I only paid it half an hour previously and my insurance doesn't even start until the 15th of this month. This charge is really unfair.

Can the insurance company get away with this?

Would really like help here. Thanks in advance.

Quentin

Lintama wrote: »

Can the insurance company get away with this?

Would really like help here. Thanks in advance.

You agreed to their ts + cs when buying the policy. If they include a fee to cancel, (most do), there's not a lot you can do, except learn from it!

dunstonh

This charge is really unfair.

Actually its very fair. £26 is a low amount. You have created unnecessary work so why should all the other policyholders have to pay for your work?

Can the insurance company get away with this?

Yes. Indeed, explicit charging like this is seen to be fairer than having everyone pay for it in increased premiums.

If you didnt like the cancellation fee then why did you buy a policy with a cancellation fee?

_Andy_

Where we're going, we don't need....roads.

dunstonh

"He's an idiot. Comes from upbringing. His parents are probably idiots too. Lorraine, if you ever have a kid that acts that way I'll disown you. "

Lintama

Quentin wrote: »

You agreed to their ts + cs when buying the policy. If they include a fee to cancel, (most do), there's not a lot you can do, except learn from it!

The mistake I made was to rush into paying. I should have read the terms and conditions although it wasn't obvious about the cancellation fee. I thought the cancellation fee applied when the policy was in force and not beforehand.

I had hardly hit the 'pay' button when another quote was emailed to me which was cheaper. I can't see that there was any work done by anybody. Had I left it several days before wanting to cancel, I can see the point but not after just half an hour, for goodness sake.

Next time I will wait a bit longer to make sure that I am happy with the policy before hitting the 'pay now' button.

Thanks for your comments.

Comyface

Great Scott!!

Lovin' the quotes _Andy_ and dunstonh.

InsideInsurance

There is a lot of behind the scenes work done, most of it is automated but that doesnt mean there arent costs involved. CUE, MID, DVLA, Experian etc can all levy fees for interactions with their databases. Documents can be "instantly" processed. Cancellation documents now need to be processed. Call centres need paying to cancel policies. There's a whole host of infrastructure required to support those call centres. Software houses can charge a per sale fee. Advertisers still need paying (if you went via a "sponsored link" on Google then the click cost is at least £5.50 and often can be several times that).

As has been said, the regulators think it is fairer that those that cancel bear the cost of cancellation rather than making everyone pay for it.

losgiganteskid

InsideInsurance wrote: »

As has been said, the regulators think it is fairer that those that cancel bear the cost of cancellation rather than making everyone pay for it.

Its funny that the regulators/insurers don't use the same criteria when offering new business quotations, which are "free" and paid for by all policyholders !! - and the reason they don't - cos they can't.........who would pay for a quotation ???

InsideInsurance

True, though to be honest, most customers prefer it that way in addition to regulators. In the region of 97% of people say they buy based primarily on price, cancellation rates are typically around 5-10% and so you have at least 87% of people that have gotten a cheaper price and dont get hit by the cancellation fee.

dunstonh

losgiganteskid wrote: »

Its funny that the regulators/insurers don't use the same criteria when offering new business quotations, which are "free" and paid for by all policyholders !! - and the reason they don't - cos they can't.........who would pay for a quotation ???

It would be a logistical nightmare to do that. Plus, consumers dont demand it. However, consumers do demand that they buy from the cheapest premium at the top of the list.