Car Insurance cancellation fee after death

Stokiekris

Hello, i hope somebody can give me some advice. i haven't included the name of the place for the moment as i still haven't rang them up to ask about it.

My sister passed away in January quite suddenly and i'm an executor of her will.

Her car insurance brokers/intermediares were informed of what had happened and they requested a copy of the death certificate and the certificate of insurance which we sent to them as soon as possible, (had to wait a few days for the death certificate), while we also informed them if anything was due to be paid we'd have to wait for the probate to come through.

She paid her insurance via direct debit and that was up to date. So, really i was just expecting a cancellation fee if anything, if they were crass enough to want the cancellation fee anyway.

Today i've had a letter through from them saying they are owed £143.14 and i have to contact them within the next seven days to arrange payment.

They gave me a breakdown of the account:

+£199.50 Paid via direct debit
- £185.22 Charge for time held on cover.
- £30 arrangement fee
- £50 cancellation fee.
- £77.42 loss of commission charge.

Balance due = £143.14

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They say they'll use any credit/debit cards on record in order to settle the balance if we fail to settle the debt. I imagine they'll struggle with that given the solicitor sorting everything out for us has control of the accounts etc. with no money going in or out!

We're still waiting for the probate to come through so they're going to have to wait no matter what.

This is their terms:What You Pay


We normally receive commission from insurers or product providers and make charges for handling your insurance as follows:

1. New business arrangement fee: Up to 40% of the insurer’s premium or £100, whichever is greater
2. Adjustment/policy alteration fee: Up to £35.00
3. Cancellation fee: £50.00
4. £5.00 Administration fee on any reminder letters sent by recorded delivery post
5. £5.00 Administration fee on any refunds issued
6. In the event of there being a rebate of premium following an adjustment / cancellation on the Insurance policy it is our standard practice to apply a charge of up to 20% to cover any commission claw back the insurer(s) may apply.
7. Our usual commission rate is usually between 10%-20% of the insurers premium, please feel free to contact us if you require the exact figure for your particular policy.
8. You will be required to pay any debit balance. If you fail to settle a debit balance promptly, we will then use any credit/debit card details that you have previously authorised us to use, in order to settle the balance.

We will notify you of the total premium payable, including any fees, taxes and other charges separate from the premium, prior to the conclusion of your insurance contract.

I expected a cancellation fee at worst. While i can stomach the arrangement fee to a certain degree as well. It's the charge for the loss of commission that narks me.

From what i understand from the terms, that has to be paid if there is any rebate? We haven't had any rebate or anything like that (even if we had it would be in my sister's name and i wouldn't be able to use it to pay off her debts until the probate comes through), so why do we have to pay £77 for their loss of commission?

Have i got it completely wrong? Is this something that is a regular fee that needs to be paid if someone dies? To me it feels like a death tax :mad:

Thankfully their offices were shut by the time i returned from work as i'd have blown my top at them (rightly or wrongly ), I've calmed down a fair bit since so i thought i'd ask for some advice before i do ring them and ask them politely what is going on!

All and any advice gratefully received and very much appreciated.

dawyldthing

i think it seems a bit harsh of them and would ask them to reconsider as a good will gesture as they have all the information so there is no excuse for the charges tbh

dacouch

A polite letter requesting them to review their charges may result in a reduction especially if she has been with the broker for some time.

Which broker / Insurer is it?

vaio

what [STRIKE]crap[/STRIKE] hard hearted company. But, that not withstanding, it seems to me that you need to cancel the policy and the terms for that are clearly laid out in the "what you pay" bit.

assuming the £199 was payment in full for the year then.....

3. covers cancellation and is £50
6. covers commission claw-back and allows up to 20% of any premium refund to be charged. You are due a premium refund of about £15 so they can keep £3.

Add it all up and it means you need to pay them about £40 maximum. If they ask for any more then stick a complaint in and refer it to the FOS


.

Stokiekris

Thanks for the replies. The total premium was £870 which my sister was paying monthly by direct debit. The £199 was what she had paid up until the time of her death with no late payments or any payments due after we cancelled it.

We haven't had any refund or rebate.

Going to give them a call..

Stokiekris

It's Onesure insurance.

j2011

I would tell them to take her to court.

That was the only way I could stop a gym pursueing my brother after he died.

And yes, they did write to Mr. OH, deceased.

Stokiekris

Because the policy didn't go the full term and they are not going to receive the commission that would have been due to them from the insurers if it did. This 'loss' must be paid by us (my sister's estate anyway).

Will contact the FOS.

Not happy.

vaio

Stokiekris wrote: »

Thanks for the replies. The total premium was £870 which my sister was paying monthly by direct debit. The £199 was what she had paid up until the time of her death with no late payments or any payments due after we cancelled it.

We haven't had any refund or rebate.

Going to give them a call..

That changes the claw back bit of my post.

They will argue, with some justification to be honest, that the agreement to pay monthly needs discharging (ie your sisters estate needs to pay the outstanding £870-199 = £670) and then they will refund the unused part of the premium (ie £870-£185 = £685) and 6. allows them to keep up to 20% of that refund to cover commission claw back.

They are actually asking for £77 lost commission which isn't unreasonable.

You could query the commission and/or the arrangement fee but it doesn't sound unreasonable so I'd be inclined to pay it (or rather get your late sisters estate to pay it) and move on.

j2011

This 'loss' must be paid by us (my sister's estate anyway).

Is there anything left in the estate after funeral and other expenses?

After paying for my brother's funeral there was nothing left, he did not own a house, he rented from the local authority.

I had to pay some of the funeral costs.

Stokiekris

Not sure how much will be left from my sister's estate after everything has been paid.

To me it seems unreasonable that they are asking for money they WOULD have received if the policy had gone full term. It's not like my sister has just cancelled on them and gone with another insurance company which if was the case, i'd agree with the charge.

If someone dies, to expect money to be paid that they would have received is a bit much and shows up the company for what they are.

Way of the world i suppose