Charge for loss of commission

bensim90

First post I hope I have posted this in the right place and conforming to all rules!

My current insurance broker is quoting me a ludicrous cancelation fee mainly due to their charge for loss of commission. Any and all help would be appreciated. I will try and keep this brief.

We have been under cover for landlords insurance since Nov 18th covered by a large national broker at around £600 PA. Unfortunately 3 months into the policy I noticed that I had accidentally made an error when taking out the policy prompting me to call the insurer to make them aware. I manage the let on my mothers behalf and was unaware that she had undergone insolvency before I was even born back in 1988 and had not disclosed this on the policy.

Upon calling the broker they quoted me an additional premium of around £100 on top of what was already paid bringing an already expensive policy to a unsustainable cost. This prompted me to seek alternative cover which I have found direct with an insurer for half the original premium!! I can't understand why I didn't find this in the first place I did all the comparisons and those not included.

I then asked about cancelling the policy. They have offered a refund of less than a third of the original premium which makes the three months that I have been on cover a ludicrous cost and making the cost to change not worth while. The high cost to cancel is in the main due to their commission, in rough terms the insurer is refunding them £400 two thirds of the premiunm they are keeping £200 one third and I get less than that. Crazy.

So £600 already paid,

I can pay the additional £100 premium as whether I do this or cancel and move, for the same period of cover there is no difference in cost.

Out of spite I can accept the offer of cancelation and move. Either option makes little financial difference.

I have tried disputing both the additional premium and the cancelation fees relentlessly with their customer service, its all in their T&C's and I got nowhere on many attempts.

Is it worth going down the complaints procedure?
Because of the non disclosure do I have grounds to have the policy cancelled from inception?
Is there anything else I can do?

Thanks.

paddyandstumpy

Sounds like Swinton.

Ultimately you signed up to the policy and their T&C's when taking out the policy, so you're bound by them (as they are too).

If you push for a nondisclosure and try and get the policy cancelled from inception (also, and more commonly, called policy avoidance) you'll need to disclose previous insurer cancellation. Will will be far worse than your current predicament.

Personally I'd pay the AP, suck it up, learn from the mistake and lapse the risk at renewal.

bensim90

Thanks for the reply,

I take it from what you have said insurance companies don't take to kindly when you have to tick the box "insurance cancelled or declined in the last 5 years"?

Cheers

silvercar

I'm surprised that an insolvency as far back as 1988 needs to be declared or is even available to find on public records.

bensim90

It is surprising silvercar,

Another point to put out their.

I did all the leg work here to get the quotes and was obviously unaware of the insolvency. After getting the quote from the current insurer they then put a call to my mum the policy holder to confirm the details.

Now she does not remember being asked if she had ever been bankrupt. Either they asked and she can't remember or they didn't confirm her details and took my word for it.

Question is, should they of run through the full policy with her or is her permission for me to act on her behalf enough?? Leaving them to take my word for it.

If they should be running through the full policy with her its our word against theirs but if the question has not been asked of her do we have a non fault non disclosure?

Am I barking up the wrong tree is this just going to cause all kinds of hassle with future policies if we pursue cancellation from inception or policy avoidance?

bensim90

Just spoke with insurers quoting the new lower premium,

If I pursue a cancelation regardless of fault they would not be willing to insure.

Current insurer has me on a leash and Paddyandstumpy is quite right I am going to have to pay up.

Thanks all.

Aretnap

bensim90 wrote: »

I take it from what you have said insurance companies don't take to kindly when you have to tick the box "insurance cancelled or declined in the last 5 years"?

True - in fact it's worse than that; most (not all) insurers ask if you have EVER had a policy cancelled, which means it can make getting insurance difficult/expensive for the rest of your days.