Insurance Cancellation Fee

Emmabel

I have just cancelled my home and contents insurance with Northern Rock - not because of the latest news concerning their finances but because they quoted my renewal premiums as £55 a month when AA could offer me the same sort of cover for only £25 a month. However, received the cancellation form from Northern Rock which my husband and I have to sign and return but it says on the form that we have to pay a £25 one off insurance fee. Can they do this? It states that if we don't pay the fee now, they will add it to our mortgage loan and we will have to pay interest on it. Sounds like a bloody cheek to me!

I'd appreciate some advice.

Thanks.

Karen

lisyloo

Yes it's perfectly legal I'm afraid.
It's for the admin involved.

It sounds like they have you overr a barrell as you have a mortgage with them as well and they can attach it to that.

What I would advise you to do in future is to read the policy up front and if you aren't happy with their fees then cancel (or check before taking the policy out) and find one that has no fees or lower fees.
On many website e.g. direct line, you can actually check out the policy (by downloading a pdf) beforehand so you don't even have the hassle of taking out the policy and cancelling.

I'm afraid there is nothing you can do except learn from it for the future.