One call Insurance - Policy Time On Risk Charge

moneylove2014

Hey all.

We're on the money diet! We've been living the lifestyle of reducing our outgoings since reading Martin's book all those years ago. Where some years we lapse with paying attention to renewals and simply continue policies rather than looking into the competition, this year, after a house renovation and a squeezed budget, paying attention is the order of the day. So, our renewal came in for our building insurance from the Co-op. We had to contact them to adjust the bedroom count as we've had a loft conversion and this years quote for renewal was a lot more. So we used the quidco compare comparison site.

I'm going to keep this as minimally 'he said/she said'

One call insurance had the most competitive quote. We called them. They are a broker and found AXA to be the most suitable match for us. We went ahead with the policy on the understanding that we would see the paperwork and if we needed to cancel there was no cancellation charge.

Having received the paperwork which needed to be signed we became increasingly uncomfortable that the third party company we'd 'just pay our direct debit to' was actually a finance agreement with an extortionate APR - a company called creation.

As this had not been fully explained we doubted the integrity of the company selling and cancelled. We are now subject to the 'Policy Time On Risk' Arrangement Fee of £49 which forms part of their laughable 'cooling off period' and hadn't been explained properly either - the cover itself was around £300 for the year so this is a significant fee.

To listen to our call to ascertain our claims would cost £10! This was subsequently waived but I feel probably because they didn't listen to the whole call!!!

We went round in circles with the key phrase of my partner saying 'no worries' re the £49 charge and not within the context of the entire conversation, being repeated back to us. He asked to speak with a manager. We were told no manager would come to the phone. Again, asked to speak to a manager, again not available but then after the following time half the fee was waived just like that.

We've got a quandary now. We will complain to them - I anticipate a useless avenue - we'll also contact the ombudsman - the public shouldn't be subject to excessive, unethical charges when they have seen ABSOLUTELY no detail of what they have been sold BUT from twitter conversations I understand they simply slap on charge after charge for 'late payment' from a debt agency 'Judgement order listings' if you are in dispute of the payment. Anyone any experience?

We've had building insurance before with banks - but it seems because they are registered with the FSA rather than the FCA the cooling off period means it. I feel it's really scammy and though it's apparently within the framework of the law it doesn't stop it being wrong and unethical. Thoughts?

rs65

moneylove2014 wrote: »

We've had building insurance before with banks - but it seems because they are registered with the FSA rather than the FCA the cooling off period means it.

The FCA replaced the FSA. Regardless of arranging it through a bank, you are still buying cover from an insurer.

Such fees are commonplace now and £49 is not unreasonable. Paying monthly is usually expensive and it is often with an external finance house.

dunstonh

Having received the paperwork which needed to be signed we became increasingly uncomfortable that the third party company we'd 'just pay our direct debit to' was actually a finance agreement with an extortionate APR - a company called creation.

That is how most deal with monthly payments now. The consumer credit act was tightened and providers now follow its requirements which requires disclosure that never existed in the past.

As this had not been fully explained we doubted the integrity of the company selling and cancelled.

It isnt a disclosure requirement. Could you imagine how long the phone calls would be if every minutia and insignificant point had to be disclosed?

We are now subject to the 'Policy Time On Risk' Arrangement Fee of £49 which forms part of their laughable 'cooling off period' and hadn't been explained properly either - the cover itself was around £300 for the year so this is a significant fee.

The cancellation rights period does not mean you get free cover. They are allowed to charge for time on risk.

To listen to our call to ascertain our claims would cost £10!

£10 is the statutory charge for a data subject access request under the data protection act.

We've got a quandary now. We will complain to them - I anticipate a useless avenue - we'll also contact the ombudsman - the public shouldn't be subject to excessive, unethical charges when they have seen ABSOLUTELY no detail of what they have been sold BUT from twitter conversations I understand they simply slap on charge after charge for 'late payment' from a debt agency 'Judgement order listings' if you are in dispute of the payment. Anyone any experience?

The FOS have published in their monthly publications about cancellation charges and their example of £50 was considered fair. In this case, it is not a cancellation charge but a period on risk charge. It appears you are after free cover. That makes you rather unreasonable. Not them.

If you refuse to pay then they can register it as a debt. Again, quite normal for people who do not pay their bills.

We've had building insurance before with banks - but it seems because they are registered with the FSA rather than the FCA the cooling off period means it

The FSA was disbanded and replaced with the FCA. The FCA inherited the FSA rules and guidelines and the FSA has never had any problem with people being charged for time on risk. Indeed, it is in their handbook that it is allowed.

There is no cooling off period. There is a cancellation rights period but you pay for time on risk.

I feel it's really scammy and though it's apparently within the framework of the law it doesn't stop it being wrong and unethical. Thoughts?

You seem to have made this a mountain out of molehole on a totally irrelevant issue and seem to have some misconceptions which have turned a relatively simple transaction into a difficult one. I know you wont like my response but it does seem you are going way over the top when no wrongdoing appears to have taken place.

dacouch

Brokers (Of which One Call is one) tend to use third party finance companies to provide their instalments, this is because.

a) The industry regulators place very strict requirements on how they handle client monies eg they would not normally be able to use your premium to settle another clients premium with an Insurer.

b) A third party finance provider can collect the premiums for any additional covers such as legal or any fees.

c) Insurers often offer their own instalment schemes, however they normally will not collect the premiums for other covers eg legal or fees. In addition each Insurer tends to have a different system so for someone like One Call to gear their website up so that it can offer each Insurers own instalment scheme would involve lots of extra costly programming.

d) The third party finance companies normally pay the broker a commission of around 3% of the financed amount.

The APR on Insurance policies often looks very expensive due to the way APR is calculated. It's fairly easy to work out exactly how much extra the Instalments will cost, you will find Co Op also charge for paying via instalments although the percentage they charge is probably proportionately less although if you've left them I assume One Call's total price was less than Co Ops

moneylove2014

dunstonh wrote: »

That is how most deal with monthly payments now. The consumer credit act was tightened and providers now follow its requirements which requires disclosure that never existed in the past.


The cancellation rights period does not mean you get free cover. They are allowed to charge for time on risk.



£10 is the statutory charge for a data subject access request under the data protection act.



The FOS have published in their monthly publications about cancellation charges and their example of £50 was considered fair. In this case, it is not a cancellation charge but a period on risk charge. It appears you are after free cover. That makes you rather unreasonable. Not them.

If you refuse to pay then they can register it as a debt. Again, quite normal for people who do not pay their bills.



The FSA was disbanded and replaced with the FCA. The FCA inherited the FSA rules and guidelines and the FSA has never had any problem with people being charged for time on risk. Indeed, it is in their handbook that it is allowed.

There is no cooling off period. There is a cancellation rights period but you pay for time on risk.



You seem to have made this a mountain out of molehole on a totally irrelevant issue and seem to have some misconceptions which have turned a relatively simple transaction into a difficult one. I know you wont like my response but it does seem you are going way over the top when no wrongdoing appears to have taken place.

You're absolutely right I have had a misconception. This was not the period on risk charge I quoted from their paperwork. There was no risk, we couldn't have claimed as the cover started in a months time. This is the £49.00 set up fee.

What annoys me the most is I sat there in the room, obviously they can't go into the minutiae of all the detail of the cover, but we wanted to see the minutiae before deciding it was right for us. I'm not having a monthly payment go out for cover that isn't right for the house. It wasn't made clear from the person selling the insurance when Gwyn asked 'so if this cover isn't right for us, and we cancel we won't be charged a cancellation fee?' and they said no, that there was another fee applicable. Also, we were never given the option of paying upfront rather than setting up a payment agreement.

I appreciate you have strong views and I probably come across as similar to the frustrating people who don't understand these simple concepts of the area of business you are in. But while you can communicate your position clearly in writing, over the telephone, the delivery is very very different and I feel that the guy selling our insurance policy was unclear. Very unclear.

moneylove2014

UPDATE: they started taking money from our bank account today despite the fact we cancelled. They insist they have sent a letter cancelling the policy sent on 7th May. Well, it's never arrived which seems to be a familiar problem with their other clients on another VERY LONG thread about how incredibly **** they are as a business. We are still waiting to be billed for the set up fee which was slashed from £49.00 to £24.50 within 15 minutes. We are still receiving paperwork from Creation. Having heard from other people on the internets about the next stages I expect we'll be getting fined next. We've been recording all our phone calls with them. I WISH I had recorded the first one.