Infuriating policy idiot of the week award!

InsideInsurance

kwmlondon wrote: »

Okay. The law states that anything you buy online you can cancel within 14 days. That's the law. Them's the rules.

Which "rules" are you referring to?

The Distance Selling Regulations? If so then insurance and other financial services are explicitly excluded from the DSR (see http://www.legislation.gov.uk/uksi/2000/2334/regulation/5/made)

gov.uk wrote:

Excepted contracts

5.—(1) The following are excepted contracts, namely any contract—

(a)for the sale or other disposition of an interest in land except for a rental agreement;
(b)for the construction of a building where the contract also provides for a sale or other disposition of an interest in land on which the building is constructed, except for a rental agreement;
(c)relating to financial services, a non-exhaustive list of which is contained in Schedule 2;

Whilst the insurance industry is not covered by the DSR it does have its own set of rules that it must abide by such as the Insurance Code of Business (ICOB). This likewise specifies that there must be a cooling off period for ALL insurance sales (unless a claim is made) but does not prohibit the charging of fees for those cancellations

dunstonh

Okay. The law states that anything you buy online you can cancel within 14 days. That's the law. Them's the rules.

The law you refer to is the distance selling regulations. However, insurance does not fall under that law. Instead, you have FSA regulation that largely adapted those regulations but they are not the same.

However, the law states that anything you buy online you can cancel straight away. I knew this - she knew this.

No cancellation fee. Nothing.

Again, let's make this clear - IT'S THE LAW.

You are wrong. Sorry. A charge can be made.

missile

kwmlondon wrote: »

I had LITERALLY just bought the policy and it had not begun. The 3% fee showed up on the summary page AFTER payment had gone through. I'm normally really astute on this stuff but fair play, the AA managed to sneak the charge past me.

You said in post No1, 1.5% then £3 and now 3% fee.

kwmlondon

dunstonh wrote: »

The law you refer to is the distance selling regulations. However, insurance does not fall under that law. Instead, you have FSA regulation that largely adapted those regulations but they are not the same.



You are wrong. Sorry. A charge can be made.

Nop. No charge. Pas de charge. Noooooo charge. Didn't get charged. Cancelled it and no charge. Only charge if you've started using it.

Actually, I've done something similar before. Took out insurance and then checked online a week later to see if I could get a better deal and even with the same insurance company obtained a better rate. Full refund, no attempt EVER to charge a fee.

It must be that it's because it was not used. If you order something in advance you can cancel the order. This must be how it works. Of course, if the term of the insurance policy has begun that's a different matter. But if you take out insurance a couple of weeks before the start date of the policy you can cancel it without any fee or administration charge.

Anyway. Like I said, I won.

dtaylor84

kwmlondon wrote: »

Again, let's make this clear - IT'S THE LAW.

As already said, it is not. Insurance providers can -- and many do -- charge a cancellation fee in the circumstances you have described.

Perhaps you should just be thankful you were able to fix your mistake at no cost, thanks to the AA's generous cancellation policy and ignore the stupidity of their no refund policy.

kwmlondon

missile wrote: »

You said in post No1, 1.5% then £3 and now 3% fee.

You know what? I don't actually remember. It seemed like a good idea to use my cashback card and then there was a fee which was more than the cashback so I got my money back. I got annoyed by the woman enacting the stupid policy because she knew and I knew I'd get my money back. Actually, they refunded me 1p more than they charged me, so they gave ME an admin fee!

UsernameAlreadyExists

They're all just jealous!

I agree entirely with you kwmlondon, and would have done the exact same thing. Spend the 1p wisely though, don't blow it all at once on something silly

InsideInsurance

kwmlondon wrote: »

Actually, I've done something similar before. Took out insurance and then checked online a week later to see if I could get a better deal and even with the same insurance company obtained a better rate. Full refund, no attempt EVER to charge a fee.

It must be that it's because it was not used. If you order something in advance you can cancel the order. This must be how it works. Of course, if the term of the insurance policy has begun that's a different matter. But if you take out insurance a couple of weeks before the start date of the policy you can cancel it without any fee or administration charge.

Ultimately each insurer is free to set its own rules as to what it charges and in what circumstances. If you feel these rules are unfair you are free to complain to the company initially and then to escalate to the FOS but historically the FOS has supported the application of cancellation fees -v- no fee so effectively everyone pays.

Fees are less common in cases where the policy is yet to incept but that is more common practice than any "rules". Likewise they are most common in Motor as many insurers that dont have them found they were subject to negative selection when people bought policies to get impounded cars out and then cancelled them straight after for a full refund (if you were to get a full refund the price is of no importance)

The DSR does provide a lot of protection but it importantly doesnt apply to insurance, banking, travel and a few other sectors. In these cases it is of utmost importance that you do your checks before buying otherwise you can have some very costly mistakes.

kwmlondon

UsernameAlreadyExists wrote: »

They're all just jealous!

I agree entirely with you kwmlondon, and would have done the exact same thing. Spend the 1p wisely though, don't blow it all at once on something silly

Damn. You're right. I'm off to the penny sweet shop right now, and if some of the people on this thread were in charge I'd get toothache from it too!

kwmlondon

InsideInsurance wrote: »

Ultimately each insurer is free to set its own rules as to what it charges and in what circumstances. If you feel these rules are unfair you are free to complain to the company initially and then to escalate to the FOS but historically the FOS has supported the application of cancellation fees -v- no fee so effectively everyone pays.

Fees are less common in cases where the policy is yet to incept but that is more common practice than any "rules". Likewise they are most common in Motor as many insurers that dont have them found they were subject to negative selection when people bought policies to get impounded cars out and then cancelled them straight after for a full refund (if you were to get a full refund the price is of no importance)

The DSR does provide a lot of protection but it importantly doesnt apply to insurance, banking, travel and a few other sectors. In these cases it is of utmost importance that you do your checks before buying otherwise you can have some very costly mistakes.

I see your point, but obviously that would have to mean that the policy was active. If I take out an insurance policy to start after my current one has expired (let's say in two weeks time - I'm being sensible and shopping around early) then go to the impound they'll look at the policy and say "no, come back in two weeks as you've no insurance NOW." If I ask for a refund I'll get it in full as the policy is unused. However, if I took out a policy to start tomorrow and then try to get a refund tomororw I'll get 363/364ths of the refund or however they calculate it PLUS a deduction of an administration fee.

If the policy has not begun they will always refund you in full without an admin fee as they have not actually set up the policy.

Not sure what would be the case if I'd done this a month ago - must ask next time I get insurance. Would be good to know.