My car was stolen, do I have to pay off the premium?

nickywilliams

Please help me, last month I was one of the unlucky BMW owners to have their car stolen within the UK. I'd only just had the car, less than a month, my insurance company have since paid out and when comparing insurance prices on my new vehicle I decided to take out my new policy with Aviva. I have since contacted Zurich to cancel my original policy as the car no longer exists, who have told me that I need to either amend my policy to insure a new car or pay the balance of my premium. I'm a bit confused, how can they request I pay for a car that longer exists??? I've searched the internet and seem to be getting mixed reviews, some say exactly what I thought, while others say I am liable to pay the outstanding balance.

Thanks in advance

Nick

forgotmyname

You made a claim so the premium needs to be paid in full.

You bought a 1 year policy. You took out a loan to pay for it it. That loan paid the
insurance so you still need to pay the loan.

After a claim you can cancel the insurance but no refund will be given.

So either transfer the car to that policy or cancel the policy and pay the balance.

Faith177

You would have to pay the premium in full as you have made a claim.

With any policy if you make a claim from which the insurer suffers a lost you must pay the policy in full for the year. This is because you have received the service you pay your premium for.

pinkteapot

Although insurers usually offer you the option of paying monthly to spread the cost, you need to remember that insurance is really just a one-off annual payment (like your MOT, road tax, etc).

It's not something you buy on a monthly contract like a phone, Sky TV, etc.

If you had paid up front instead of by monthly installments and then cancelled the policy, you would get a pro-rata refund (less administration fee) if you had made no claims. If a claim has been made and you cancel, you don't get a refund.

In the case where you've been paying for it monthly, and you cancel and they don't owe you a refund, you have to pay the balance off.

rs65

nickywilliams wrote: »

I've searched the internet and seem to be getting mixed reviews, some say exactly what I thought, while others say I am liable to pay the outstanding balance.

Doesn't matter what you find on the internet, its what your policy says that matters.

Probably worded something like this:- We will not refund any premium if we have paid a claim or one is outstanding when the policy is cancelled.

As said above, the fact you are paying monthly doesn't matter, you will have to pay the full annual premium.

vaio

as above, it what your policy says that's important.

Having said that, all insurance terms are subject to the "treat the punter fairly" rules of the FSA & FOS.

Given insurers are always telling us that the big majority of premiums is related to third party risks then an insurer might find it hard to justify the fairness of confiscating the remainder of the policy with no refund particularly if they would allow you to transfer the remainder of the policy to another car

chanz4

This is how good bmw are : http://www.google.co.uk/url?sa=t&rct=j&q=bbc%20watchdog%20bmw%20security%20flaw&source=web&cd=1&cad=rja&sqi=2&ved=0CCkQFjAA&url=http%3A%2F%2Fwww.bbc.co.uk%2Fprogrammes%2Fb006mg74%2Ffeatures%2Fbmw-car-theft-technology&ei=k2KbUOe0L4fMhAf7iIHYAg&usg=AFQjCNECerSpfbyW26OKHl76DuB9rdmvRw

thenudeone

Normal Car Insurance is arranged as an annual policy even if you borrow the amount required to buy it, then spread the cost over several months; so Yes - you are required to pay the balance of the loan.

However, it sounds as if you are being offered to transfer the unused period or premium on to a replacement car. That's a good offer and I'd take it up if I were you.
Once they have paid you the value of the car, they have fulfilled their side of the insurance contract. You bought a policy which would pay out if your car was stolen. It was. They paid out. End of policy.
So, getting a reduction in the cost of a new policy on a new car is worthwhile.

vaio

thenudeone wrote: »

........Once they have paid you the value of the car, they have fulfilled their side of the insurance contract. You bought a policy which would pay out if your car was stolen. It was. They paid out. End of policy.........

yep, but he also bought a policy that, among other things would cover him against third party risks for 12 months. If the insurers are to be believed then the theft part of a policy is only a small part of the premium so the logic/fairness of the whole contract coming to an end (with no refund) on a theft pay out is certainly arguable and probably flawed.

My home insurance covers me for theft (among other things). Are you seriously suggesting that my entire policy ends if I make a claim for a stolen lawnmower?

Tirian

vaio wrote: »

Given insurers are always telling us that the big majority of premiums is related to third party risks then an insurer might find it hard to justify the fairness of confiscating the remainder of the policy with no refund particularly if they would allow you to transfer the remainder of the policy to another car

Irrelevant. The premium for most if not all car insurance policies (and many others too) is an annual payment. If you make monthly payments, it is generally only because you have been loaned the money to pay the premium. The monthly payments in this case are not really premium payments, but loan repayments. As such, it does not matter if or when a claim is made - you still owe the money.

property.advert

It is a bloody con.

Whatever the legalese, they insured you for a year. The premium you paid is a combination of risk factors, only one of which is total loss.

For example, following a total loss, there is zero chance of your giving rise to a claim by a third party for an unknown amount and yet they are asking you pay a premium to cover that risk.

You could also cause a claim worth millions but if your vehicle was not a total loss, they would have to continue to cover you for that year.

To my mind, that is immoral if not unlawful. I guess there is some case law on this from a long time ago but is Which? and the consumer groups here to fight the common cause ?

Also, if young drivers are blamed for all manner of things causing our premiums to rise exponentially, why is there not a company who simply states that they will not insure anyone under 30 for instance and then reward everyone with cheap insurance ?