Motor insurance rip off

rouflab

Has anyone ever thought of changing insurance provider during part of their insured term BEWARE, some Motor Insurance providers will rip you off, re a refund on the remaining term. I have two cars and house Insured with Direct line already. I got a great quote from Direct Line insurance for my 3rd car a smart car due for renewal, which I took up, on talking to the agent I mentioned I also had a motorhome, they said they could also insure that at an amazing price. So I went to my present insurer of the Motorhome to cancel the policy I had out since June this year, only to find I was only getting back £120.00, which equates to 40% of what I paid. If I was to cancel the policy in month 5 I would get nothing back. Their sliding scale works as follows after 1 month 70% refund, after 2 months 60% refund, after 3 months 50% refund, after 4 months 40% refund and after 5 months NOTHING. This company and others but not all do this. I repeat not all do this. BE WARNED READ THE SMALL PRINT ON CANCELLATION. I was not informed verbally when asking about a quote. ASK ASK , READ READ. MAKES THE BANKS LOOK LIKE ANGELS

worried_jim

Why cancel the policy you already had?

Iceweasel

Would I be right in thinking that you had only been with your motorhome insurer since June - so a new policy - not a renewal with them in June.

If so what they are offering as a refund is quite correct and normal.

leedsmodus

A policy is a 12 month contract and if you are paying monthly is a credi agreement and have every right to deduct pro rata cover charges and admin charges to cancel. When you purchased your policy if you had read the t and c 's which they advise you will receive and the 14 day cooling off period then you could of cancelled the policy with out forfeit of loss. You agreed to the t and c;s, you did not read them,. stop moaning

vaio

Yep, the FOS view on mid term cancellation by punters is that insurers should give a broadly pro-rata refund for the unused part of the policy less an admin fee. In terms of admin fee £50 has previously be ruled as reasonable.

In the OP's case, with a premium of £300 and 9 months of the policy left the refund should be in the order of £225 less the admin fee so the £120 is a bit on the low side.

Depending on the dates it might be that he has to pay for 4 months in which case the £120 is looking closer to reasonable.

As always, if the OP feels he has been treated unfairly then he should lodge a complaint with the insurer and if still unhappy with the response then refer to the FOS

dacouch

vaio wrote: »

Yep, the FOS view on mid term cancellation by punters is that insurers should give a broadly pro-rata refund for the unused part of the policy less an admin fee. In terms of admin fee £50 has previously be ruled as reasonable.

In the OP's case, with a premium of £300 and 9 months of the policy left the refund should be in the order of £225 less the admin fee so the £120 is a bit on the low side.

Depending on the dates it might be that he has to pay for 4 months in which case the £120 is looking closer to reasonable.

As always, if the OP feels he has been treated unfairly then he should lodge a complaint with the insurer and if still unhappy with the response then refer to the FOS

This type of policy eg motorhome along with other seasonal policies such as motorcycle tend to use short period cancellaton rates. This is because they have a very high proportion of customers who take out cover in Spring / Summer and then want to cancel in Autumn when the weather closes in.

Whether the Ombudsman would agree with them that their cancellation charges are fair remains to be seen as the Ombudsman does allow non pro rata refunds where it can be justified.

These types of policies tend to be operated by brokers who have a scheme with an Insurer so you have costs for the Insurer and broker. They're also often issued manually which involves more work in the first year.

I agree that depending on the exact dates it may also involve an extra months cover being charged.

I'd be checking the exact cover DL are offering as the chances are it's on a private car basis with just the normal benefits of a private car policy. Most decent motorhome policies include breakdown cover, cover for personal effects, awnings cover and generator etc etc

colino

I'm sick to death of rip-off insurance companies, the way they operate you would think they are in some kind of commercial business. I've just checked and I find I've paying out for years on something called, "Life Insurance" and I've yet to make a claim or see a penny of it. Get in Trading Standards, something should be done about it. Oh, and think of the children.

Iceweasel

I have my camper insured Fully Comp and renew it yearly with the same company (I do check that it is still the best deal though)

I only licence it 6 months a year - from May to the end of October when I lay it up for the winter.

I then tell my insurance company that I want only Fire & Theft cover.

I get no refund at that point, but when I renew or return to Fully Comp I get a return pro-rata for the time it has been on reduced cover. It's worked out in so many 365ths of the annual premium.

Doing it this way is MUCH cheaper than just taking out cover for 6 months.

If you change company and then cancel the policy during the first year they will certainly treat it as a short term insurance and therefore you will NOT get a full pro-rata refund - if anything.