car insurance

jonzi.999

hello
basically one of my friend was with this car insurance he had 2 months left on the policy and he got banned from driving so he just cancelled the direct debit but he didnt tell his insurance company and the company didnt bother to contact him he just recieved one email saying that they couldnt take the money out of his bank. last week he got phone call off the company asking him to pay £500 that he owes the company. i was just wondering that what can the company do becouse my friend is unemployed n really broke n worried.

jobdone1

It's a contract. So he will have to pay the balance even if your friend gave notice their would be a cancellation charges within the terms of the policy.

George_Michael

As "your friend" has now discovered, simply cancelling the payment doesn't automatically cancel the contract that the payment was intended for.
Unless they want to risk having their credit record trashed and being unable to get insurance in the future they should contact the insurance company as soon as possible and come to an arrangement about paying the money that is owed.

dacouch

Was he involved in an accident or had he claimed on the policy?

Did he sell the car when he was banned and if so does he have proof?

AdrianC

Your friend bought one year's insurance, and took out a finance product to pay for the premium.

Not paying the last 17% of a debt does not let somebody off that debt.

He needs to pay what he owes, before it starts to increase rapidly due to cost - or he will find himself in court for that debt. If he still doesn't pay, then he will find himself with a CCJ, more fees, and people knocking on his door to take his things away.

d0nkeyk0ng

As above, the annual car insurance is a single payment. You can choose to spread the payments over twelve months (just like a loan) but you have to pay the whole amount. It's not like a pay-as-you-go rolling monthly contract where you cancel whenever you want.

So your friend has to pay off the loan, irrespective of whether they're using or need the insurance.

curty510

your friend defaulted on the contract he signed, he still owes 2 months direct debit payments, any late fees from the agreement he signed, plus a now cancellation fee that he also probably signed up to.

A valuable lesson learnt, i find its always cheaper to keep the direct debits going than to cancel.

AdrianC

curty510 wrote: »

A valuable lesson learnt, i find its always cheaper to keep the direct debits going than to cancel.

You still need to cancel the insurance.
http://www.visordown.com/news/general/biker-may-be-forced-to-pay-thousands-after-banned-new-owner-has-fatal-crash

Iceweasel

jonzi.999 wrote: »

hello
basically one of my friend was with this car insurance he had 2 months left on the policy and he got banned from driving so he just cancelled the direct debit but he didnt tell his insurance company and the company didnt bother to contact him he just recieved one email saying that they couldnt take the money out of his bank. last week he got phone call off the company asking him to pay £500 that he owes the company. i was just wondering that what can the company do becouse my friend is unemployed n really broke n worried.

You appear to contradict yourself:

the company didnt bother to contact him

but then

he just recieved one email saying that they couldnt take the money out of his bank.

He should have responded to that e-mail.

He has no chance of not paying what is owed, and he needs to come to some agreement with the Insurance Co asap otherwise he will have HUGE problems in obtaining insurance, any kind of credit, or a mortgage in the future.

Has he now actually cancelled?

If not they may have auto-renewed and he is building up more debt and more problems.

Good luck.

andrewn_2

same ere, was just leaving policy running as only 1 month left and cancellation was higher than payment but mrs cancelled dd dropping me right init

jonzi.999

he sold his car and hes living at different address. i am not sure if he has got proof or not