Can they do this?

Legacy_user

My dad (78) changed his car this week and rang his insurer to advise them of this. They told him they were going to cancel his insurance with effect from next Tuesday due to an incident involving his car which occurred recently and that any renewal would be at almost double the price. He has changed his car from a 1.6 Ford Focus to the new 1.0 ecoboost Ford Focus which is similar bhp and torque.

Now he still has 3 months left on his current insurance which he is paying by direct debit monthly and which they still want to collect in full.
The claim they referred to was damage caused to his car when it was parked outside his house. No-one was in it and the damage was caused by a neighbour who paid for the cost of repairs. My dad did not make any claim whatsoever on his own insurance but did inform them at the time.

Can anyone tell me if they can do this or what to do to prevent them cancelling his insurance on Tuesday and forcing him to take a more expensive policy?

forgotmyname

Are you sure he informed them at the time of the incident?

Not sure where the power and torque come into it?

There is a possible chance a claim could be made and they want the policy paid up for the full year which to me would be expected.
How long ago was this incident?

So the reason for them cancelling the policy is? Are they not willing to cover the new car? Or did he fail to disclose facts about that incident?

If they do cancel the policy dont forget he needs to mention that when taking out a new policy. Otherwise they may double the price or cancel the policy also.

If they wont cover the new car then pay the old policy off and go elsewhere without the need to declare a cancelled policy. But make sure the incident is declared, Probably 5 years.

You need to find out the exact reason for the cancellation.

System

The incident happened a couple of months ago and as he was required to do he informed them at the time and the other party paid in full for the damage. The other party reversed out of their driveway into the side of my dads car. I assume that party claimed off their insurance.

All my dad did was ring up when he got the new car (just mentioned power and torque show he changed to similar car) so that they could change the details on his policy.

I don't see why he should have to pay to the end of the term if they are cutting the cover short 3 months before it's due for renewal.
We will shop around for him to find a new policy and tell the new company the relevant details but I think my dad should just cancel his direct debit for the current policy.

forgotmyname

OH dear. On no accounts should you just cancel the direct debits.

Or will you be getting new quotes with zero no claims and the incident and having a policy cancelled. Then debt collectors calling.

Big mistake..

You need to sort out WHY they are cancelling. Did he actually inform them of this incident? Sounds like he didnt and they are cancelling for non disclosure.

Having to declare having a policy cancelled for non disclosure or potental fraud if deliberate wont help insurance quotes in the future. Many wont quote at all.

Best course of action is sort it out with them. Do not let them cancel the policy.

Payup and put a complaint in afterwards.

System

forgotmyname wrote: »

OH dear. On no accounts should you just cancel the direct debits.

Or will you be getting new quotes with zero no claims and the incident and having a policy cancelled. Then debt collectors calling.

Never thought about that .
So do you think if he pays the last 3 installments they will still give him proof of no claims to pass on to other insurers?

It really seems so unfair. He hasn't made any claims in years on his insurance and didn't need to with this incident. Could it be because of his age?

DD265

Can't they just update the details on his current policy to cover the new car for the remaining 3 months of that policy?

That's what happened to me when I changed car. I did have to pay a bit extra because the new car was in a higher insurance group (I think it was a lump sum to pay as I'd paid up front for the insurance rather than by direct debit) and then my policy just continued until the expiry date covering the new car instead of the old one.

thenudeone

There is no absolute right to demand that an insurance company must insure a new car. The policy was taken out for a specific vehicle and if that the policyholder wants to change vehicles, everything is up for re-negotiation. Most will change the policy to the new car based on the change in insurance cost for the new vehicle plus an admin fee, but they don't have to. The insurer may decide they don't want to offer cover on the new vehicle and there's nothing you can do about it.

When the policy was taken out, the policyholder may have met the criteria for acceptance (for example a maximum of 1 claim or incident in the last 5 years) at that time.

Now that a quote for a new is required, they will re-assess everything based on the information at the time of the re-quote. If there has been an incident during the year, the policyholder may not meet the criteria any more even though the criteria hasn't changed. The policyholder now has now had two incidents in the last 5 years, which the company won't quote for.

It sounds like two things have been said by the insurer and got mixed together:
1) you've sold your vehicle so you want to cancel the policy and obtain a credit (in line with the cancellation charges)
2) you've asked us to re-quote for the new vehicle but you no longer meet our criteria so we can't offer you a policy

In this case, he'll just have to shop around.

Nearly all certificates nowadays specify the vehicle by registration plate so if he has already changed the car without getting a new certificate (which the insurers are not going to give him), he is driving without insurance at the moment. He needs to get a new policy straight away.

If the policy is cancelled simply because the policyholder informed them that he no longer has the vehicle and does not require cover, that's a normal and routine process and not one which classes as a "cancellation" which needs to be declared. The policyholder has cancelled the policy by telling them he is going to, or has, sold the vehicle; not the insurer.

forgotmyname

Personally i would payup then write a formal complaint.

But did he or did he not declare the incident? Niggling me that is the reason for them cancelling the policy. If thats the case then try and persuade them it was a mistake.
Otherwise some companies wont quote and others will want more money.

Has he got the new car now? goto askmid.com own vehicle button and see if its insured.
If not dont drive it and make sure its off the road. Before it gets impounded.

System

Asked my dad again and he definitely told them when the neighbour hit his car.
It sounds as if thenudeone is correct. He has effectively given them an excuse to get out of insuring him by changing his car.
I'll help him shop around for a new policy and do what forgotmyname suggests and put in a complaint after he pays the remainder of the premium.

Thanks for all you help