Cancellation of car insurance

johnbfan

My son bought a car on Saturday morning. My son did an online insurance application with Adrian Flux on Saturday aftenoon, paying with his debit card and received an email with what looked like an insurance certificate.

He phoned them today and they said they had not insured the vehicle but had just emailed a document to him. He told them to cancel any application he made to them at which he was told they would be charging him £80 because they sent him the document.

Surely if he has a 14 day cooling off period he should not be paying anything?

bazster

If the policy has started they can charge a "reasonable" admin fee for cancellation. £80 is not by any stretch of the imagination reasonable.

And they can't have it both ways: "oh no, the insurance hasn't been arranged, but we'll charge you for cancelling it!"

Tell them that if that if they deduct £80 you will go to the Financial Ombudsman.

George_Michael

bazster wrote: »

If the policy has started they can charge a "reasonable" admin fee for cancellation. £80 is not by any stretch of the imagination reasonable.

Apart from being allowed to charge for the cost of setting up and cancelling the policy, they can also charge for the time that the policy was in force.
Even though there may only have been cover for a couple of days, short term cover is generally far more expensive than just a pro rata percentage of the annual policy so it might well be something like £50 for the admin fee and £30 for the time that the policy was in effect.

forgotmyname

14 day cooling off is not a 14 day free insurance deal.

Admin charges and charges for time on cover still applies.

bob_a_builder

I just cancelled within the cooling of period
took out insurance to start on a Thursday, sold car on the Saturday, cancelled on the Monday
they said oh thats within cooling off period - no problem
received refund of original amount - £2

Ectophile

johnbfan wrote: »

My son bought a car on Saturday morning. My son did an online insurance application with Adrian Flux on Saturday aftenoon, paying with his debit card and received an email with what looked like an insurance certificate.

If it's anything like the multi-page documents that Adrian Flux usually email out, then have a good look through it. If it was actually an insurance document, then one page of the PDF document would clearly say "Certificate of Motor Insurance" at the top.

If not, then it was probably just a statement of what details they had recorded for the application, and perhaps a request for any documents they require.

InsideInsurance

bazster wrote: »

If the policy has started they can charge a "reasonable" admin fee for cancellation. £80 is not by any stretch of the imagination reasonable.

It is not an administration fee it is a cancellation fee. It covers not just the administration cost of cancelling the policy but also the sunk costs, including marketing, of selling the policy in the first place.

The ombudsman does allow an average to be taken rather than it being calculated for each cancellation individually and so when you consider the £60+ paid to aggregators, £10 per click for Google Adwords etc the charges software companies can levy etc it all adds up very quickly.


To the OP - as others have already pointed out. A cooling off period only gives you a legal right to cancel, it doesnt mean it has to be fee free. In theory after the cooling off period you have no statutory right to cancel at all but for obvious reasons most classes of insurance do allow you to (though not all, PMI often doesnt allow cancellation post the cooling off period)

Foxy-Stoat_3

johnbfan wrote: »

My son bought a car on Saturday morning. My son did an online insurance application with Adrian Flux on Saturday aftenoon, paying with his debit card and received an email with what looked like an insurance certificate.

He phoned them today and they said they had not insured the vehicle but had just emailed a document to him. He told them to cancel any application he made to them at which he was told they would be charging him £80 because they sent him the document.

Surely if he has a 14 day cooling off period he should not be paying anything?

If he paid for the policy via his debit card, is he not then insured, assuming the date the policy was to start was Saturday?

Why does he want to cancel it now?