RAC Car Insurance cancellation charge

sleepyfrog

My sister has car insurance with the RAC and her car has just broke the timing belt and is a right off.

She can't afford to get a new car for at least a few months, but the RAC are saying she has to pay £55 to cancel the policy.

I can see that being fair to switch insurer, but as the car is dead - and they know this as it was the RAC man that told her it was a right off - it seems a bit of a liberty to me.

Anyone know if this is a valid charge in these circumstances?

InsideInsurance

Several years ago the FOS and FSA both deemed that £50 was reasonable as a cancellation fee. Inflation would easily have taken that number up to £55 or more.

Could ask them if they will suspend the policy instead until she can get a new car but they've no obligation to do so.

jstallan

I spoke to them earlier today and was quoted £75 to cancel a policy nearly 6 months old. I needed to change a car over and was considering cancelling the policy as there was a £25 (admin fee) and £32 increase.

hcb42

Yes it is valid charge, having breakdown with them does not mean she will escape the admin charges