car ins cacellation costing £48

Rich_Pauper

I've got a car ins policy with Swinton, my car is going to be sold/scrapped. as I'm not planning on getting another car I rang to cancel the policy. They were going to change me £48 (not refund) to cancel the policy. I told them to forget it. Can they really do that?

What are the consequence of not cancelling? I can see the benefits, eg: not paying £48 and keeping the NCB.

InsideInsurance

The main risk is if the new owner of the vehicle doesnt get insurance or its stolen from them etc then your insurers are possibly still the RTA insurers for any accidents. If they are found to be the RTA insurers in a fault accident then it has 2 reprocussions

1) Lose your NCD
2) You have to repay your insurers for the cost of the third party's claim

Technically if you do 2 then 1 doesnt apply any more but in my experience few people have the funds to repay their insurers straight away in full. The biggest case I saw for an RTA insurer was about £300,000 which the person had to repay

Obviously the chances are very slim but its up to you to judge the risk -v- cost

Rich_Pauper

InsideInsurance wrote: »

The main risk is if the new owner of the vehicle doesnt get insurance or its stolen from them etc then your insurers are possibly still the RTA insurers for any accidents. If they are found to be the RTA insurers in a fault accident then it has 2 reprocussions

1) Lose your NCD
2) You have to repay your insurers for the cost of the third party's claim

Technically if you do 2 then 1 doesnt apply any more but in my experience few people have the funds to repay their insurers straight away in full. The biggest case I saw for an RTA insurer was about £300,000 which the person had to repay

Obviously the chances are very slim but its up to you to judge the risk -v- cost

thanks for your prompt advice.

the car will be registered in the buyer's name, won't that make any difference.

also are you saying i could lose the NCD, if my ins company pays for the damage or can my ins company demand payment for the damage?
If they did can't i sue the buyer?

InsideInsurance

Rich_Pauper wrote: »

also are you saying i could lose the NCD, if my ins company pays for the damage or can my ins company demand payment for the damage?
If they did can't i sue the buyer?

If they are the RTA insurers then they can attempt to get the money from you, if you dont pay them or it takes you a long time to pay it (eg if it was £300,000 as per the example) then the NCD is impacted until it is paid in full.

You could then sue the driver at the time of the accident to try and recover the monies but if they dont have the funds to pay you then its your loss.

Depending on the insurer in question then they may roll over about being the RTA Insurer or force it down the full route of proof. If it goes down that route then normally the TP will have already sued the driver and been unable to get funds from them or not found the driver and so the chances of you doing any better than them is slim

forgotmyname

What if the buyer just wants your car to do a ram raid?

Police find your car dumped at the scene. You get a knock on the door in the early hours.
You tell them you sold the car weeks ago, Why do you still have it insured?

DCFC79

forgotmyname wrote: »

You tell them you sold the car weeks ago, Why do you still have it insured?

Im sorry officer I chose not to pay the £48 cancellation fee as I didnt agree with it.

agrinnall

I believe the FOS have declared that a cancellation fee of up to £50 is acceptable, so it sounds like Swinton have pitched theirs at a level where they make as much as possible without allowing their customer to win a complaint. I think you'll have to pay up, and next time check the possible charges before taking out a policy.