unused car insurance

gb61

hi all, just notified my car insurance that I am cancelling due to selling my car and at the moment not looking at another for a while, I had thought that like the car tax I would get a pro rata refund, but no! instead I was told there was an admin fee of £35 (ok) and there was no more for me to pay???? I paid a year up front last year. Is this correct? is that it? I may as well have let the insurance run. Strange . bb61

facade

It isn't strange, it is "the usual"

These companies trim their prices, and have ridiculous "admin fees" to claw some of the profit back.

Leaving a policy to run on a car sold to someone else can bite you as it is possible that the new owner won';t insure it and your insurer may be liable for an accident, and will most certainly pass any loses onto you.


Welcome to the 21st Century

Inner_Zone

T&C's? ....

colino

As well as checking their T&Cs you will find that the second your policy was in force they were taking the risk. Would you be happy if you had a total loss after six months and they only paid out half of the vehicles value because 50% of your insurance had been used up?

forgotmyname

You paid a year up front when last year? How long left? Had any claims of incidents during the last year?

Apples2

Entirely normal but each Insurer has their own T&C's.

This is from AXA

It is important that you know that if you cancel after 14 days in the first year of cover, you will not get a proportionate return of your premium. For example, if you cancelled your policy after 6 months, you would only get 35% of your premium back. And after 9 months, you would not get any refund at all.

http://www.axani.co.uk/faq/car-insurance-faq/

EdGasket

Don't know why previous posts think 'its usual'? If you pay for a year's insurance but cancel after 6 months, then you should get a pro-rata refund of the unused part of the inusrance. I have in the past where I have changed circumstances and got a refund (e.g. young driver removed from the policy). I know they skew things a bit so if you cancel at 11 months you might not get anything.

OP you'll need to read the T&C's of your particular insurer to see if they have some clause to try and get them out of paying you back. After all if you were paying monthly and cancelled after 6 months with no claims, you wouldn't expect to have to keep on paying for inurance on no car would you?

What insurer is it?

Ashingtonian

In the past if you paid upfront and had to cancel after six months you got half your premium back. Nowadays every policy has "admin" fees which imo are just legalised robbery.

Even just changing your address or car details occurs an admin charge. It's gotten to the point now where its preferable to pay monthly even if you pay slightly more overall if you think your circumstances might change over the year.

stugib

Ashingtonian wrote: »

It's gotten to the point now where its preferable to pay monthly even if you pay slightly more overall if you think your circumstances might change over the year.

Why? Won't change the fact you'll be charged admin or cancellation fees. You'll still owe the same amount, just with interest added.

benjus

Ashingtonian wrote: »

In the past if you paid upfront and had to cancel after six months you got half your premium back. Nowadays every policy has "admin" fees which imo are just legalised robbery.

Even just changing your address or car details occurs an admin charge. It's gotten to the point now where its preferable to pay monthly even if you pay slightly more overall if you think your circumstances might change over the year.

Paying monthly just means you enter into a credit agreement to borrow the premium then pay it back over the year at the agreed interest rate. You're still buying the policy upfront, just with borrowed money.

I haven't cancelled car insurance recently, but I have cancelled home insurance and got a pro-rata refund.

Ashingtonian

stugib wrote: »

Why? Won't change the fact you'll be charged admin or cancellation fees. You'll still owe the same amount, just with interest added.

What? So you even get charged just to cancel a policy nowadays? Christ I'm well behind the times:rotfl: