Insurance options when changing cars

paulpud

We've today agreed a deal to buy a used car which we're due to pick up next Sunday, so we need to ask our current insurer to transfer the policy to our new car but give us a period of at least a few hours where both cars are insured to enable the dealer to tax it for us.

I suspect this will involve an administration charge and possibly a further charge due to the new car being more expensive to cover, but if these charges prove to be exorbitant do we have any alternative? As the policy has only 2 months to run could we simply take out another policy on the new car, transfer our No Claims Bonus to it and leave the existing one to simply run out?

trailingspouse

Some insurers charge an admin fee, some don't, so you really need to ask them.

And at the risk of stating the obvious, you could have found this out (including the additional premium, if any, for the new car) before making the decision to buy the car in the first place.

If the existing policy only has two months to run, you will only be charged for two months' cover on the new car. If you cancel now, you're unlikely to get any return of premium - so you'll have paid for two months that you're not going to use, and you'll have to pay for the full cost of insuring the new car immediately. Better to put the new car on the existing policy, pay the additional premium for the new car, and use the two months to shop around for a company that may cover your new car at a lower price.

paulpud

We're fortunate that our ages and driving histories means that we don't have to pay an enormous amount for car insurance so the decision to buy the new car wouldn't be influenced by the actions of our insurers but, as the remaining two months are worth about only about £25, I'd be a bit miffed if we get quoted stiff charges to swap and so I'd like to have an alternative in mind if possible before I phone them.

I think to actually cancel the policy they charge about £50 so that wouldn't be cost effective, which is why I wondered if it was possible to take out a 2nd policy using the NCB and let the old one run out.

rs65

paulpud wrote: »

which is why I wondered if it was possible to take out a 2nd policy using the NCB and let the old one run out.

You need to tell an insurer if you no longer have the car, else they can pick up claims caused by a new owner.

You also can't use your NCB whilst its in use on another policy.

paulpud

rs65 wrote: »

You need to tell an insurer if you no longer have the car, else they can pick up claims caused by a new owner.

You also can't use your NCB whilst its in use on another policy.

Our insurers will know we no longer own the car as we will be ringing them to tell them about the change, but I wondered if the current policy could be allowed to run out as a dormant policy and another new one taken out using the NCB

agrinnall

Are you trading in your old car at the dealer where you are buying the new one? If you are then there is no point at which you will own both cars so you can transfer the insurance at the time you make the switch. There is no need for the dealer to tax your new car, you can do it yourself online or over the phone.

https://www.gov.uk/vehicle-tax

trailingspouse

Sorry - I'm confused. In your original post, you're concerned that the new premium might be 'exorbitant'. But now you tell us that you don't pay much for your insurance. As I said previously, the only way to find out if your insurer makes a charge is to ask them - some will waive their charges sometimes.

Your NCD can only be on one policy at a time, so you can't keep one policy going and use the NCD on another policy. You could cancel your existing policy (and lose 2 months of insurance that you've already paid for, with probably no return of premium, and the loss of a year's worth of NCD as they only count full years), and take out another one for the new car. But maybe the company you're with is still the best one for you?

paulpud

It's the charges that our current insurer may apply that I have concerns about, not the premium for the new car.

Our annual policy was £155 at renewal last April and, utilising the compare sites, a new policy for our new car will be around £185. As an example, if it ends up costing us £60 to switch for the next 2 months I'd consider that exhorbitant (unreasonably high) as our existing policy works out to less than £13 per month and a new annual policy around £16 per month.

If our insurers would let us cancel without an administration charge I'd be perfectly happy to do that as we'd lose nothing more than £25 in remaining insurance - we have 25+ years of NCB so losing this years NCB will have no effect whatsoever.

It was really just a little more knowledge that I was seeking. It may well be that our insurers are perfectly reasonable and the swap is painless and relatively economical but I just wondered if there were other options open to us if they aren't particularly accomodating.

Quentin

Why should your insurer let you cancel without an admin charge?

You agreed to their cancellation charges when taking out the policy!

If you are looking for money saving advice over this then we have seen from time to time that insurers will make a goodwill gesture to moaners who take up their time complaining about the charge rather than waste time over dealing with a complaint over comparatively small amount. ( Though others have been pursued for the money!)

Your options are either swallow the charges and extra premium by replacing the car on your existing policy (though check with your insurer they are happy to continue cover on the replacement), or swallow the cancellation fee and take out a new policy elsewhere.

[Deleted User]

If you're sticking with the existing insurers why not ask them and see if they waive any fees? Of course if you change frequently to save a bit of cash then they'll probably say no and they'll be well within their rights to charge you the full whack. You can't have it both ways if that's the case.

FutureGirl

If you tell the insurer you no longer own the car they will ask you to either cancel or put the new car on the policy. The policy can't run without a car to cover.

You shouldn't just 'let the policy run' with the old car as, if the new owner is in an accident, the third party can claim from your policy as it's still active and covering the car. Also, if you do this and take out a new policy for the new car, you can't transfer the NCD to the new policy as it's in use on this one and can only be used on one policy at a time. You also have to tell your insurer about any changes.

If you do cancel the current policy to start a new one, you won't get the NCB for that year.

You should just change the car on your existing policy and swallow the admin fee (which you agreed to when taking out the policy).