Car Insurance Cancellation

r1cbm

Hi there,

We bought car insurance in September and always pay for 12 months up front as it's cheaper. (320 in total I think)

We have just sold the car and are getting a new one this weekend.

My wife (her policy) called the company up to change and they said £50 to change the car :silenced:

MY response was !!!!!!??? Usually it's a 10 or something.

So... I then said search for a new policy which came out at 295 (and I think 40 cash back) which is great.

So, she called to cancel the policy and expecting some form of refund. They said there's no refund :mad:

I have cancelled policies in the past, and always had a %age sent back without an issue.

We have approx. £80 worth of insurance left, = 3 months. I would have to pay £40 to access it as it's no use now. Then renew (else where in Sep).

Can insurance people do this? if it's not used how can they charge you for it?

r1cbm

One Quote Direct
Once the policy has been set up in accordance with your instructions, we will retain that part of the quoted premium that represents our commission and fees, regardless of any specific changes or cancellation that you request. Additionally, if we undertake processing work in making a mid-term change or cancelling the policy we make an administration charge to cover the work involved in changing your policy on behalf of your insurer. This administration charge will be £50 for all mid-term changes, adjustments, alterations, cancellations, copy policy or duplicate documentation, and renewal transaction. These amounts are in addition to any charge imposed by your insurer.

= Basically you have no hope of any changes to be made to the policy and they can charge what they like

r1cbm

just found this also...
you also have the right to cancel your policy at any time during the period of cover. Please refer to your



policy booklet for full details of the Insurer charges. If you wish to cancel your policy, you must send us your current certificate of insurance (for motor

insurance) with a letter saying that you want to cancel your policy. It is important to remember that cancelling your direct debit does not cancel your policy. We,

the insurer or any agent appointed by us and acting with our specific authority may cancel this policy by sending you a 7 day notice of cancellation to your last

known address (and in the case of Northern Ireland to the DVLNI). Provided that no claims have occurred during the current period of insurance we will calculate

the premium for the period that we have been insuring you and refund any balance, less our administration charges.

r1cbm

Interestingly, we didn't receive the policy booklet or the insurance document as we called them and they had to resend it.

InsideInsurance

Brokers/ insurers have to stipulate how cancellations are charged and any admin fees that are applied.

If the admin fee to do a mid term adjustment is £50 you can bet the cancellation fee is going to be that or more (its often more). Insurance premium is also rarely "consumed" in a linear fashion but front loaded such that if you cancel in the last quarter, take off the admin fee etc you'll fairly rarely get any refund if you have a low initial premium. Additionally many add ons (eg Breakdown & Legal Expenses) never give a refund if cancelled outside of the cooling off period (first 14 days)

If you call back to the insurer/ broker they can explain how they have arrived at the nil refund/ charge calculation

zeon999

Most places these days make sure it does not make financial sense to cancel anything these days unfortunately.

Insurance from my experience is defiantly one to avoid cancelling, for a couple of reasons, one is the cancellation charges, the second reason is it means you will lose out on that year towards you NCB.

Quentin

r1cbm wrote: »

Interestingly, we didn't receive the policy booklet or the insurance document as we called them and they had to resend it.

If you only just received this then you may have grounds to complain that you were unaware of the cancellation/change costs (depending on how long ago you asked for it to be sent) when originally taking out the policy.

But if you had it from the outset, then it's too late to get round to reading it now!

dunstonh

My wife (her policy) called the company up to change and they said £50 to change the car

MY response was !!!!!!??? Usually it's a 10 or something.

Figures upto £60 are not uncommon. Was it a round £50 or was it £x for admin and £y for premium?

So, she called to cancel the policy and expecting some form of refund. They said there's no refund

I have cancelled policies in the past, and always had a %age sent back without an issue.

We have approx. £80 worth of insurance left, = 3 months. I would have to pay £40 to access it as it's no use now. Then renew (else where in Sep).

Can insurance people do this? if it's not used how can they charge you for it?

Car insurance refunds should be relatively pro-rata but dont have to be exact. You tend to find its less pro-rata at the start where all the costs are but gets closer to pro-rata as time goes on. However, it would be typical to find it a little off. i.e. 3 months left may see 2 months refund. Then when you factor in cancellation fees, you may find hat wipes out the premium left.

Providers have to publish their cancellation terms?

vaio

and remember the FOS view is that they expect cancellation to be done a broadly pro rata basis plus an admin charge.

With about three months of a £320 policy left and given admin fee of £50 you aren't going to get much of a refund.

You also won't get any NCB for this year so, depending on how much you have already, it might be worth paying the £50 and finishing the year with your existing insurer to collect an extra year of NCB

r1cbm

Quentin wrote: »

If you only just received this then you may have grounds to complain that you were unaware of the cancellation/change costs (depending on how long ago you asked for it to be sent) when originally taking out the policy.

But if you had it from the outset, then it's too late to get round to reading it now!

Nope, we bought the insurance and searched high and low for the documentation and emails, nothing. They resent it through today to check a detail on there but it was just a basic 1 page with the policy number and no real details.

Believe me, I keep EVERYTHING when it's documentation related, as we have nothing for this insurance.

Quentin

When you bought it (presumably online), you will have had to accept their conditions prior to the policy being issued.

Where are you getting the conditions from now that you are quoting un your posts above?