Car Insurance Miscalculated, Now I Owe Money!?

JamieL_2

Hi Guys, wanted to get some advice...

Basically I took out car insurance with Insure Your Motor on 28th April 2013 and the monthly instalments were £185.79 (its high as im young and have points on my license).

I changed address recently and rang up to confirm my new address with them in May. Because of my change of address I was told my insurance would actually become much cheaper because of the postcode I am now living in. I also asked about the cost of adding my partner to the policy and was informed that it would cost nothing extra to add her, so she was added to the policy too.

On 31st May 2013 I received a letter through the post from Insure Your Motor enclosing my new insurance documents with my partner added to the policy which was effective from 28th May 2013. I also received a letter from Premium Credit (who handle the payment/finance agreement for Insure Your Motor) stating:

"We have received a request from Insure Your Motor to amend your monthly Direct Debit payments relating to your credit agreement with us to pay the premium for your insurance. With effect from your next payment date on 1st June 2013 your Direct Debit payments will be £91.98 and collected on or immediately after the 1st of each month."

So I was happy my car insurance had dropped from £185.79 to £91.98, however I was surprised at the same time.

I received exactly the same letter from Premium Credit on 21st June 2013 with exactly the same wording stating my policy had been amended and payments will be £155.67 on my next payment date of 1st July.

Anyhow I was late making June and July payments, so I had to ring up. I rang up and agreed to pay June's payments of £91.98 + £20 late fee on Friday 5th July 2013 and I agreed to pay £91.98 for July's instalment on 12th July 2013 and then the lady on the phone confirmed my monthly instalments of £91.98 would continue from 1st August.

I did receive a letter through the post stating that my instalment of £155.67 for July was overdue shortly before I made July's payment and I rang up to question why they were asking for £155.67 when I agreed on the phone to pay £91.98 and my installments were agreed at £91.98 and asked them to check the recording of the call which will confirm all of this. The person on the phone said they would investigate it and that I could just pay the £91.98 for now until its been investigated.

Anyhow so I paid June's payments of £91.98 + £20 admin charge and I paid £91.98 for July as agreed and was under the impression that I was now back on track and caught up with all my payments and from 1st August I will continue at £91.98 as agreed.

I received a phone call yesterday (18th July 2013) from Insure Your Motor stating they had miscalculated my payments and that I was actually not paying enough. They said my installments should have been £155.67 and not £91.98. I told the lady on the phone I am sorry but you agreed that I would be paying £91.98, I was under the impression that that's what it was and that's what I intend to pay.

She said I would have to make payments to cover June and July where I only paid £91.98 when it should have been £155.67, but she would be able to split it over the remainder of the contract so I don't have to find the extra money on one sum.

I said I am sorry but I am not agreeing to pay this money and that I wanted to get advice and see where I stand first, because we agreed that it would be £91.98 and that it was there error and not mine. She confirmed that yes it was there error, but I still have to pay it back and said its fine go and get advice but you still need to pay it back.

So where do I stand? I was told my insurance would change to £91.98 and now they are telling me they messed up, it was there error and it should actually be £155.67 and that not only will I have to pay the corrected amount for the remainder of my instalments but I have to find the money for the underpayments for June and July.

Surely if they agreed a price with me, then thats what it is, right? The new contract is dated 28th May 2013 (however they have no pricing on the contract) and the letter about changing the instalment amount to £155.67 is dated 21st June 2013 (24 days into the revised contract).

So should I agree to pay £155.67 for my future payments or am I entitled to only pay £91.98?

Do I need to make up the difference for June and July's instalments even though we confirmed the price on the phone and we even confirmed future instalments of £91.98 will be setup from 1st August.

Please can someone that understands the legal side behind this tell me where I stand. Ideally I just want to keep paying the £91.98 that we agreed on and that we agreed I would be paying when I rang up last week to make July's payment.

Hope to hear from a few of you soon and sorry for the long post, just wanted to make sure I got all the details down.

Thanks!

spacey2012

Do you have it in writing from them that the payments were to be £91 for the amendment of the policy ?

JamieL_2

I have a letter confirming it from Premium Credit, but then they sent another letter out on 21st June (24 days later) with an amendment stating it was to be £155.67 from 1st July as they realised they had made an error.

I spoke to someone last week when I rang to make July's payment and she confirmed it was £91.98 for July's instalment and then £91.98 from 1st August and for the remainder of the contract.

It was yesterday I got a call stating they made an error (yes they owned up to it) and that the plan should be £155.67 and not £91.98 and now future instalments should be more and that I need to pay the difference to make up June and July's instalments where I have been paying £91.98!!

Quentin

You need to determine who made the error (insurer or moneylender), and take it from there.

Your insurer should have sent out confirmation of the changes you made (and new cert showing the added driver), together with the premium amendment. So see who is to blame, and pursue your complaint against them.

JamieL_2

Its Insure Your Motor who messed up.

I got a letter from Premium Credit, stating that they received a request from Insure Your Motor to amend the Direct Debit to £91.98 and then a same letter about a month later after they realised their error saying they received a request to change it to £155.67.

Insure Your Motor work out the price and tell Premium Credit what it should be and then Premium Credit are the ones that setup the direct debit and take the payments.

spacey2012

But no paperwork from the insurer stating the price and terms ?
...IMPORTANT...

JamieL_2

Insure Your Motor don't put pricing on any of their paperwork. But I have this from Premium Credit (who handle the finance agreements on behalf of Insure Your Motor) which states Insure Your Motor requested the amendment...

This is the first one:

simplesmarketing[dot]com/personal/Car%20Insurance%20Instalments-page-%C2%A391.98.jpg

This is the second one (after they realised their error):

simplesmarketing[dot]com/personal/Car%20Insurance%20Instalments-page-%C2%A3155-67.jpg

Insure Your Motor also record their calls and therefore they have recordings which will confirm I was told it would be £91.98 for July and £91.98 from 1st August and each month thereafter until the contract ends.

Is this not good enough proof?

Quentin

Now you know it's the insurer you can make a formal complaint.

Use their complaints procedure which will be set out in the policy docs.

If you are unhappy with their response you can escalate the issue to the FOS for their adjudication.

rs65

JamieL wrote: »

Insure Your Motor also record their calls and therefore they have recordings which will confirm I was told it would be £91.98 for July and £91.98 from 1st August and each month thereafter until the contract ends.

Your first post suggests you got letters about the instalments and/or were phoning to pay arrears. Was this Premium Credit you were speaking to?

When you phoned to change address, did Insure your Motor not tell you a revised premium. You said you were surprised when you got the letter from Premium Credit with the £91.98 amount

JamieL_2

I spoke to Insure Your Motor to make the payments. Direct debits get setup by Premium Credit but when in arrears and making one off payments you have to call Insure Your Motor to make those payments.

I believe they told me an estimate price on the phone which may have been about £150, but said the confirmed amount would be sent in the post.

spacey2012

What Quentin said.