Car insurance accidental non-disclosure, I want to pay but they won't let me

Cosmo538

Hi, I'm feeling very stuck!

I had a policy with Diamond insurance in the period of 2014-2015, when taking this policy out, I had a pending TS10 not yet on my licence, I did not disclose this because it was pending and the online comparison website's form that I was using just asked me if I had any offences on my record, there was no box saying please list anything pending so I wrongly assumed that because it was not on my licence I did not have to declare it. This was only my second year of driving and I did not know yet that I had to then go back and declare it when it did go on my licence.

I then rang Diamond when that policy ended to discuss a renewal and if it would be cheaper than getting a policy elsewhere. I mentioned the TS10 and then was told that because I didn't tell them I now have an outstanding amount of £772. I was told I had only 2 options, pay it in 2 instalments or 1 lump sum. I said I could afford neither of those options and the call was ended. I expected a letter in writing but I didn't receive one so I pretty much forgot about it (Naively assuming that maybe the woman on the phone had took pity on me and not logged that I had mentioned it)

Then just shy of a week ago, 8 months after the call, I receive a letter saying I had to pay the full amount within 7 days otherwise they will be passing the debt on to a collection agency. So I thought okay, fair enough, this was my mistake and I owe them the money, I'll ring them to discuss a payment plan and then we'll move on. However, when I rang them I was told the most they can offer is 6 months, which still works out as over £120 a month. I have recently lost my job due to my contract ending and am currently working as a delivery driver so I am barely making ends meet. I said I don't have the option to borrow the money off a family member and the most I can afford in my current financial situation is £50 a month. I was then told that this also is not an option and they are still going to have to pass it to a debt collection agency.

I have a few gripes and worries, for one I think it is unfair to not notify me in writing for 8 months and then to give me 7 days to pay.
Also, why was I not offered the 6 month payment plan 8 months ago when I spoke to them, I was only given the 1 or 2 lump sum payment options. If I had been offered that at the time, I was in a financial situation to pay it over 6 months so I would have taken it.
I feel entirely discriminated against, as essentially because I don't earn enough to pay it on their terms, I now face this debt getting passed on to a debt collection agency, this worries me because I think it might affect my credit score and also I don't want to have a debt collection agency chasing me.
I feel totally lost as I am trying to pay them in the way I can afford but I'm getting totally knocked back.

I have currently spoke to a supervisor and have now escalated it higher to another team which deals with complaints I believe, I am expecting a call back tomorrow. I'm fully aware of my mistake and willing to pay the outstanding amount, I just can't afford to pay it on such a short term.
Do I have any legs to stand on when they call me back or do I just have to accept that it's going to a debt collection agency, also, if this is the case, does anyone have any advice on dealing with debt collection agencies as this is never something I've had to deal with before as I have never missed a payment before.

Any advice would be greatly appreciated,

Thank you

Quentin

You are taking the only action open to you (complaining) - apart from separately escalating your request for payment on the drip to a higher authority at the insurer.


If you are unhappy with their reply you can then escalate your complaint to the FOS for their adjudication at no cost to you.


(If they are your current insurer beware them cancelling your policy over the default)

Cosmo538

They are not my current insurer, I am now with a different insurer, with the TS10 fully declared so my current insurance is not an issue.

If I take the complaint to the FOS, what will I do in the meantime when the debt is passed on to a collection agency and they are asking me for the money? Or am I able to stop them from passing it on whilst I register a complaint with the FOS?

Thank you

Quentin

Taking a complaint to FOS won't stop them pursuing you. (Though whether it's direct or via a debt collector and you cannot pay, then it makes little difference)


Point out to them that you cannot pay it as a lump sum and keep asking for a payment plan.

Cosmo538

If it does go to a debt collector, I will likely set up a payment plan that I can afford with them. But I would much rather just keep it with Diamond.

Do you agree they are being unfair by not allowing me to pay in instalments that I can afford or are they allowed to do this?
What can I hope to achieve from logging a complaint with the FOS?

Again, thanks for your advice

Quentin

A creditor can take whatever (legal) action to get a debt paid - they aren't oblige to let you have a payment plan.


Your OP says you feel unfairly treated, and the FOS is hot on customers being treated fairly. That is your hope for a favourable outcome.


Whether you end up paying the insurer or a debt collector, the outcome is the same for you isn't it?

Cosmo538

Yes the outcome is the same, but I am worried that by passing it on to a debt collection agency, it will have a negative effect on my credit score which may affect me in future. I do not have much experience with this as I am 24, but I would not like a mistake like this to have any bearing on whether or not I could get a mortgage in future, as I say though, without much experience I don't fully know how much this will affect my standing.

The main thing thought is that yes, I do feel I am being treated unfairly. But what sort of outcome would I achieve logging a complaint with the FOS?

Quentin

If they agree, then they will (hopefully) get your insurer to treat you fairly!


(If you default your credit record normally gets marked by the creditor, not a debt collector!)

magpiecottage

Passing the matter to a DCA whilst you are trying to negotiate a reasonable solution is a risky tactic. It could incur the wrath of both FOS and the FCA.

Cosmo538

Thank you both for your input. I have managed to reach a resolution through persistence. Someone from the complaints team rang me back, we went over the details and after lengthy conversation they have halved the amount to £386 on the basis that it took them 7 months to send it to me in writing. I have now arranged a 6 month payment plan. Overall a great result which I'm very happy with!