Car insurance never set up direct debit?

northernlights54

I have been getting calls from an insurance company I got a policy with last year. They are saying that I need to pay them several thousand pounds as they have not collected any money off me since october 2011.

I gave them all my details correctly but they never set up the direct debit, I have not claimed on my insurance or anything like that and they only ever took a deposit off me.

I do not use the car myself as I have given usage to my mother, I have signed nothing and I never sent as copy of my driving license to the insurer. They are saying that I entered into a verbal agreement by paying the deposit and are asking for a few thousand pounds that are outstanding.

I know the figures sound dramatic but I am a young convicted driver and its making more sense to me to commute on a push bike until my convictions are "spent"

Could someone tell me where I stand with the insurance co?

northernlights54

shameless self bump

InsideInsurance

Firstly, you are fortunate that they haven't voided the policy for non-payment as that would give you massively inflated premiums for the rest of your life!

Secondly, obviously you still owe them the money. Given they didnt take it in theory it is still there but inevitably you will say you spent it and that of cause you dont monitor your accounts closely and so didnt notice the fact you had an extra £X more than you expected each month and the DD wasnt showing.

You need to come to an agreement with them for repayment of the debt unless you prefer them to involve CCJs etc

*Scarlett

Insurance is usually a 12 month contract. Whilst you can cancel it if you wish you may have a hefty cancellation / admin fee and would pay for the time that they had insured you for - this is often loaded if you cancel shortly after the policy starts.

You paid the deposit and they agreed to cover you for 12 months.

It's not just a verbal agreement -presumably they sent you policy documents and a schedule which would have told you about the contract. This would have given you details of how to cancel the policy if you wished to do so.

You agreed to pay the installments by DD. If there was an issue with the DD and they were not able to collect the payment they should contact you to tell you - which they have done.

Did you use the car at all since Oct 2011? Presumably you would have expected the insurer to cover you if you had an accident in the 1st month for which you had paid the deposit.

Is the car now insured by your mother?

Are you sure that you did not cancel the DD - perhaps you did not recognise the cahrge on your account. If so, this is not sufficient to cancel the insurance.

It seems that you do owe them the money but if they are applying extra charges you can ask for a breakdown of these.