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Misleading Quote and Direct Debit Collection Charges!

I received a renewal quote for horse insurance, which appeared reasonable for the benefits against other insurers. The quote included a Direct Debit agreement with the amount filled in. However when my first Direct Debit was taken the amount was much greater and there is also a monthly charge for collecting my direct debit.
Is this allowed?? How best can I challenge this?

Comments

  • InsideInsurance
    InsideInsurance Posts: 22,460 Forumite
    10,000 Posts Combo Breaker
    It is normal that to take credit to spread the costs monthly that interest is added to the bill.

    What does the covering letter say about prices for paying lump sum -v- monthly? If it doesnt say anything then how does the price compare? Does it say how many monthly installments there are as some take 10 rather than 12 (like council tax)
  • dunstonh
    dunstonh Posts: 119,502 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    There are a couple of documents issued in the process that you should have received before the payment is taken.

    1 - a quote on the monthly payment (which is typically higher than annual premium as you need to consider the cost of finance)
    2 - advance notice of the monthly direct debit amount and dates. This would arrive at least 10 days before the first payment.

    What happened to these?
    Is this allowed?? How best can I challenge this?

    Yes it it allowed. There is nothing to challenge. However, you should have had the documents above. Did you ?
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Horse Insurance is generally offered as a monthly or lunar month payment option and that is what you are quoted on. The charge isn’t due to credit for monthly payments it’s actually stated as being a “collection charge” and while not a huge amount, again it wasn’t included in the monthly amount quoted in the renewal and on the direct debit agreement. I’ve never been charged for a direct debit payments before only for credit or credit card payments (which is usually clearly stated).
    Also if I'm agreeing to and giving my bank permission to debit a set amount on the Direct Debit Agreement, how can they just debit a completely different amount without letting me know? I was quoted £32.50 but have been debited £39.50 an additional £91 over 13 lunar months.
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