home insurance

austin_7

I have just had my house insurance renewal from Insure For Retirement and it appears to be that my monthly payment plan goes through a company called Premium Credit Ltd. Is this a normal procedure thing? Why do I have to pay interest on something I haven't taken out. I thought the quote was the amount I would be paying?? I pay by monthly direct debit.
Thanks to all.

rs65

Premium Credit are a well known premium finance company.

Usually a quote is for annual payment. There is often a surcharge for paying by instalments.

Presumably you chose to pay by instalments so interest is normally added.

austin_7

Thanks for that.
Yes I did opt to pay by instalments.

InsideInsurance

Most direct insurers self fund people wanting to pay by installments so the money continues to be paid directly to them.

Brokers and other intermediaries however generally have to pay the insurer in full up front and not all want to fund that and then have to deal with getting installments etc from the insured and so use a third party credit provider like Premium Credit. The credit company gives you a loan and pays it directly to the broker. The broker then pays the insurer. You repay the credit company by installments.

Any fees/ interest for paying by installments will/ should have been listed when you bought the policy normally in the form of saying a one off payment is £100 or you can pay monthly at £10 for 12 months (ie £120)