Possible unfair charge from Car Insurance company

edited 30 June 2017 at 2:55PM in Debt-free wannabe
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mclmcl Forumite
1 Post
edited 30 June 2017 at 2:55PM in Debt-free wannabe
Hi,

I might be posting in the wrong forum, please let me know if this is the case.

To the case:
I sold my old car and bought a new one. Insurance company for the old car charged way too much to cover the new one and I found another insurance for almost half price.

So I purchased the new insurance and cancelled my old one. I paid monthly, and they are now charging me £1.2k for the cancellation (which already happened). I have asked for a breakdown of charges, to which I got no reply yet.

I have never made a claim and it feels very unfair that after cancelling the policy, I still have to pay £1.2k, they will get this money for free as they are not covering my vehicle anymore, and even if they were, I have already sold it.

Has anyone had any experience with cancelling insurance halfway through when paying monthly?

One thing to note is that despite having received the policy confirmation when my policy started, I have never signed anything, could this be used in my favour?

Best Regards

Replies

  • What do your terms and conditions say about cancelling?
  • HasbeenHasbeen Forumite
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    mcl wrote: »
    Hi,

    I might be posting in the wrong forum, please let me know if this is the case.

    To the case:
    I sold my old car and bought a new one. Insurance company for the old car charged way too much to cover the new one and I found another insurance for almost half price.

    So I purchased the new insurance and cancelled my old one. I paid monthly, and they are now charging me £1.2k for the cancellation (which already happened). I have asked for a breakdown of charges, to which I got no reply yet.

    I have never made a claim and it feels very unfair that after cancelling the policy, I still have to pay £1.2k, they will get this money for free as they are not covering my vehicle anymore, and even if they were, I have already sold it.

    Has anyone had any experience with cancelling insurance halfway through when paying monthly?

    One thing to note is that despite having received the policy confirmation when my policy started, I have never signed anything, could this be used in my favour?

    Best Regards

    You are paying by monthly direct debit? It means basically you had a years contract to pay! what does your policy state re cancelation?
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  • sourcratessourcrates Forumite
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    Hi,

    Essentially, when you buy car insurance on a monthly basis, you are taking out a credit agreement for that insurance.

    The cost is broken down into monthly payments, and then interest is added to give you a monthly premium.

    You cannot simply cancel the agreement half way through the contract, with out settling the outstanding payments that are due.

    If you took out this policy online, you would probably of had to tick a tick box, or just to press "confirm" to agree to the terms and conditions of the contract, online sales do not require a physical signature to be valid.

    All this information would of been supplied to you at the start of the agreement, so unfortunately for you, you are liable for this 1.2k insurance debt.

    Its not an "unfair charge" its the remainder of your credit agreement that you agreed too.
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  • EssexHebrideanEssexHebridean Forumite
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    If it helps to clarify things a little - you weren't paying for your insurance on a monthly basis (for example like you might pay for a SIM only mobile on a rolling monthly contract) you were paying for a 12 month insurance policy by an agreement to spread the payments over the 12 months. You *may* get somewhere by appealing to them on the basis that you would not have cancelled had it been made clear to you that the full premium was still payable - however I have to say I somewhat doubt it - insurance companies are noit generally know for having a "better nature" to appeal to.
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