Admin Charges by Car Insurers

bev309

I work for a car insurance company. Admin charges are normally stated on your documents. Any charge over this amount - for changing address, occupation, mileage etc. is charged for any extra risk involved for insuring you after making that change. For example - a change of address is based on how many claims have been made in the area, how many incidents have occurred in the area etc. Cancellation charges are charged for breaking your contract mid term, & these too should be clearly stated on any documents you have, & you normally have about 14 days after accepting as a 'cool-off' period so you have plenty of time to read the T&C's of the policy.

stooby

When you get a quote you (are supposed to) receive an Initial Disclosue Documet (IDD) or a Terms of Business which states any fees you may have to pay either when you take out the policy or at mid-term/renewal etc. The wonderful chaps at the FSA state this must be done:

"When you contact an insurance provider, they must give you details of the service they offer. It may be in a about our service document, but doesn't have to be. They will tell you:

whether they're offering you advice or just information about the product;

• whose insurance policies they offer – it may be from one company or many; and
• how much you'll have to pay for the service.

Use this document, or information to shop around to get the service you want at the price you're happy with."
Source: FSA's Money Made Clear website.

t is implicit that all potential/future charges are disclosed. When you shop around on-line, you will often be offered the chance to look at this document (by clicking to open in a new window or whatever) but as it's long/in a small font/in pdf format which takes a dogs age to load, it is usually overlooked.
This was a not very well publicised but useful website the FSA launched last year.
I would urge anyone looking online for insurance to check this document and also to watch out for the other common pitfall: your policy excess. When they quote you a price they will also show your "Voluntary Excess" of say £100. You need to also find out what the "Compulsory Excess" is (again, buried somewhere in small print usually) as you have to pay the Total Excess (i.e Vol + Comp) in the event of a claim. Having a Vol XS discounts the premium and can make the price seem good at first glance - but be sure you're comparing apples with apples.

The short of it is, if they've dislcosed the fees to you pre-contract then there aint a lot you can do about it.

lisyloo

Well I dont see that it costs £60 to type in an address and pres cancel?

Of course it doens't but you are conveniently ignoring the software & hardware costs, electricity, rent, council tax, employers NI, pensions etc.

Add it all up.

I can easily get to £60.

pmhtuk

BUPA does not charge admin fees for amendments to medical insurance

Tracyk_2

I got caught out with these fees a couple of years ago. By making a mistake on my application form (can't remember what it was now) - I had to pay £10 fees to rectify it.
So now I double check all my details before signing. Lesson Learnt (I hope!).

shudder

raskazz wrote: »

Hastings Direct £40 + insurance premium tax = £42.

Not stated in documents either. Total disgrace.

Are they allowed to charge ipt on a fee?

dave76

I broke my arm last year and got my brother in law put on the policy for 1 day so he could get my car back home for me - Tesco charged about (I cant remember exactly) £6 for the extra cover and about £25 admin fee! I was amazed so wrote a letter of complaint - they were apologetic and thanked me for actually letting them know about the other driver rather than just taking the risk of driving uninsured, and then refunded both the admin charge and extra cover charge as a gesture of goodwill

raskazz

shudder wrote: »

Are they allowed to charge ipt on a fee?

Yes, IPT applies to fees in addition to premiums.

Of course, most companies state any administration fee inclusive of IPT. So, for example, if the adjustment fee is stated as £25, then this will be £23.81 plus £1.19 IPT.

noname_3

I have changed my car twice in one month with more than and they have not charged me anything !!

anewman

dunstonh wrote: »

OK, lets go back to the old method where the insurance premiums were more expensive and charges like this were hidden within that.

Realistically all it takes is someone at a computer hitting keys 10 minutes to sort. Does it really cost £90 an hour to employ someone to sit at a phone?! I think not!