Advice re. automatic renewal of policy

kitkatt1982

Hi all,

In need of some advice regarding car insurance policy if possible. We no longer have the car we insured but continued to make monthly payments via direct debit until term had finished. Tried to contact insurance provider on four occasions to cancel the policy but could not get through, kept on hold for up to 45 mins a time. Eventually gave up and cancelled direct debit thinking that would be the end of it. I have never cancelled a policy for any type of insurance before, just compared and taken out new, cancelled direct debit and that's been it. But as my husband needed his 'no claims' paperwork tried to contact this one. They've now taken money from my bank account by direct debit, £10 more than original agreement, three months later than the old payments finished. Are they allowed to do this? Surely if I've cancelled my direct debit they can't just take money, but I've read something about automatic renewal of contracts overriding direct debit guarantee? Any advice gratefully received! Many thanks,

InsideInsurance

If your employer wanted to dismiss you do you think just not paying you at the end of the month would be the appropriate way to do it?

With exceptionally few exceptions, cancelling payment for a service doesnt mean you have cancelled the service, simply that you are a crewing debt and potentially having failed payment charges added on top.

When the policy renewed they will most likely also renew the DD. This has nothing to do with the DD guarantee and nothing stops you cancelling the DD again but of cause you separately need to cancel the insurance. Likewise if you claim it was a "mistake" or "unauthorised" you can get your bank to refund the transaction but again that doesnt stop you owing the money.

elsien

You've possibly signed a continuous payment authority rather than a direct debit.
Step1 - talk to the bank to find out which it is.
Then ( direct quote from the FSA website)

Cancelling a regular card payment

When you give your credit or debit card details to a company and authorise them to take regular payments from your account, such as for a gym membership or magazine subscription, it is known as a ‘recurring transaction’ or ‘continuous payment authority’.
These are often confused with direct debits, but do not offer the same guarantee if the amount or date of the payment changes.
In most cases, regular payments can be cancelled by telling the company taking the payments. However, you have the right to cancel them directly with your bank or card issuer by telling it that you have stopped permission for the payments. Your bank or card issuer must then stop them – it has no right to insist that you agree this first with the company taking the payments.
Be aware though that you will still be responsible for paying any money that you owe.


So you can stop any more money going out by going through the bank, but then you need to take it up with the company directly as to the money they've already had. And as it's for car insurance they may try to say you still owe the remainder. I would suggest writing to them and explaining that you tried to cancel and were unable to do so, rather than trying to contact by phone, and use their complaints procedure if you get no joy.

dunstonh

Eventually gave up and cancelled direct debit thinking that would be the end of it.

Cancelling a direct debit does not cancel the contract. It just cancels the method of payment. It doesnt stop you owing the money. It just means you start building up a debt. Renewable contracts will sometime renew the direct debit. So, that would well be why it restarted.

mikey72

Have a look at https://forums.moneysavingexpert.com/discussion/3781099. If you no longer have the car, you can't insure it, so the insurer should void the new policy. They can also argue you should have told them when you got rid of it, and charge a cancelation fee and backdate that as well though. Ideally look for accepting that last years policy was paid up, and this years is voided from the renewal date if you can.