Who's to blame?

onethreesix

Hello one and all.

I was hoping I could get some advice/direction on a problem I have regarding bank charges incurred due to a former insurance company.

My situation is thus.
I used a switching service to switch my bank from Barclays to Alliance and Leicester and get the associated cash reward. This went through ok, all direct debits moved etc etc.

Two months later, my motorcycle insurance comes up for renewal, I go through the usual rigmarole, everything seems fine.

Long story short, I start getting huge bank charges from the old account (which I did not close as I was paying off the overdraft).
These charges resulted in a debt collection agency getting involved.

I first went to Alliance and Leicester, thinking the swithching service had not worked. I have documents showing all direct debits etc were moved fine.

I speak to the credit company used by my insurer, they state they have the new account details on file and say the fault lies with my insurer as the quote was not put through as a renewal, but a new quote.

I speak to my insurance company. they claim they do not liaise with the credit company over my payment details (which seems odd, as they would have to in order to set up the direct debits!) and they claim it is my fault for not letting them know my details changed. This is also muddied by the fact that when the account change occurred, no payments were being taken as the payments were taken for ten months, not twelve.

Everyone blames someone else. I suspect the fault lies with the insurer as the switching service did its job, the credit company had the correct details, yet money was taken from the old acxcount which did not have the funds.

Any help on how to proceed would be greatly appreciated so I can be compensated for the charges I incurred.

dunstonh

The insurer/credit company would use the direct debit details which they hold on file. Unless you tell them they have changed or the bank tells them they have changed, they will continue to use the old details.

I suspect that you have to blame the broker (if you used one) or the insurer if you went direct. They appear to have used old records and not verified they are still correct. The insurer wouldnt necessarily know the bank details had changed as you are buying the insurance on a loan. The credit company does that.

You should make a formal complain to the broker/insurer (the sales side) as they should not have relied upon obsolete information when setting up a new policy. This would not have happened had it been a renewal of existing policy as that policy was set to use the right details. It is because they set up a new one but used incorrect information without checking with you first if it had changed (probably be copying bank details from the previous years application)

Do be aware that you have a responsibility on errors to reduce the costs as much as possible. If the account had gone over its limit and incurred charges then the insurer would likely have to pay for those. However, you say it has moved on from that and the debt passed to collections. So, that would indicate a number of bank statements being issued to you from the old account. Almost certainly a number of letters from the old bank warning you of the overdraft and that they will be passing it to collections. Why did you not take action before all this happened? Whilst the insurer may be take responsibility for the error and refund a number of your charges they may decide that they are not responsible for you letting it slide into the position it is now.

onethreesix

Thanks for the quick reply.

With regards to the notifications of the problem, this was down to a problems with my post and a lack of organisation on my part.

i do have one further question.

Having checked my credit file, I can see the default from my bank is marked, along with the settlement of the matter.
Is it possible in any way to have this either removed, or noted on my file that the insurance company were at fault to improve the file?