Insurethebox change of address charge, where do we stand

christywhisty

My son is 21, passed his test a year ago and took out first car insurance last october. He is a student so insured the car at his university address (rented house). He did ask where to insure it was given quotes for home and quotes for uni. He is moving back home perminantly so rang to advise them of address and was told he would have to pay a further £330 for less than 2 months. Tjis is more than the difference in policies fo the 2 addresses for the whole year.
. They wrote to him and said if he didnt pay in 7 days the policy woukd be cancelled
He cannot afford that so has had to agree to put the policy on hold, so is not insured, but will qualify for NCB in october.

Looking on line this company seems to do anything it can to find an excuse to cancel policies and charge exhorbitant admin charge. One girl was charged nearly £3k for a change of address.
Is this grounds for a complaint to the ombudsmen?

dunstonh

Looking on line this company seems to do anything it can to find an excuse to cancel policies and charge exhorbitant admin charge.

Their cancellation charge is just £30 if no box installed and £80 with box installed. So, it is not exorbitant.

One girl was charged nearly £3k for a change of address.

Again, not quite the full story there. She would have been charged £25 for a change of address. The rest would be risk premium and not charges. She probably moved from a nice low risk postcode into high risk postcode. Many university towns have postcodes which are high risk due to volume of young drivers and high thefts.

Is this grounds for a complaint to the ombudsmen?

There are also women working for the Ombudsman service.

Firstly, you do not have access to the FOS without making a complaint to the firm first and waiting for their response.

Secondly, the FOS have reviewed charges and their published material is light on this front but they have rejected admin charges of £50 and that was around a decade ago. So, in your son's case, his charge would have been £25. So, half what we know the FOS to consider acceptable.

The risk premium is a commercial decision and the FOS will not intervene in commercial decisions unless there is discrimination or some event that shows it to be unfair. For example, if you did an online quote using the same details and new postal address and got a much cheaper premium (excluding any year 1 discount or other marketing discounts given at the time) then they may consider that unfair. Hoever, if the insurer say that the £330 is £25 admin charge and £305 risk premium as its moving from a low risk address to a high risk area based on their actuarial and claims data, then you cannot argue that point and the FOS will accept it.

christywhisty

I worked in insurance for many years i understand how they calculate risk, this is why it is so annoying. He had quotes from them for both adresses when he took out the policy. The amount they are charging is more than the difference for the full year policy, the policy has less than 2 months to run, they will only have had the risk of the higher address for 2 months. We have had numerius cars insurd at this address, it is not that high a risk area.
He has also looked at a new online quote from them and again this charge is higher than the difference for the new address for a full year policy.
Unfortunately nearly all the complaints on line are since he took out policy, or he would not have used them.

FutureGirl

I don't think the insurer is doing anything wrong, they aren't changing the risk, your son is.

Risk isn't just the area, all the factors mix in together to form the risk profile. The prices you pay for your insurance is irrelevant, as you are no where near a similar risk to your son.

Each insurer also prices and deals with risk differently, what may be deemed higher risk to one insurer, could be different to another.

If you don't want to pay it, cancel the policy and pay the cancellation charge, and take out a new policy elsewhere.

christywhisty

Please read my post properly. The quotes are for my son by the some company, not for us. The change in risk is for 2 months, yet they are charging more than the difference it would have been for a whole years policy, which they quoted for at the beginning of the policy, and a new comparrison he has done since.
If he cancels the policy he will lose his ncb.
He also has a box and his record has almost been perfect with 100% nearly a month compared to the average of 55%

lisyloo

If you've worked in insurance you'll know that annual policies are MUCH cheaper than buying short term insurance pro-rate. After all the "work" involved for the insurer on a 2 month policy is the same as for an annual policy so you can't expect to get it for 1/6th of the price. Just doesn't work like that.
I sympathise but don't see you have a leg to stand on, sorry.

csgohan4

your son is also higher risk being a new driver and under 25. For that reason I didn't buy a car until then and relied on public transport.

vaio

Charging more for two months risk that they do for 12 would, on the face of it, seem to be unfair.

There might be a real valid reason for that (other than taking advantage of a captive client) but I'd be inclined to stick a complaint in and see what happens

christywhisty

Its not a 2 month policy, the work is the 30 fee( or whatever they charge) , not he supposedly additional risk of over £300. It is an adjustment on a policy that has already been in existance for 10 months with 2 months to run and cost over a £1200.the new risk is a slightly higher risk area for 2 months of the policy.
They are taking advantage of the captive market., which is born out by recent reviews on trust pilot.

Amst

christywhisty wrote: »

Its not a 2 month policy, the work is the 30 fee( or whatever they charge) , not he supposedly additional risk of over £300. It is an adjustment on a policy that has already been in existance for 10 months with 2 months to run and cost over a £1200.the new risk is a slightly higher risk area for 2 months of the policy.
They are taking advantage of the captive market., which is born out by recent reviews on trust pilot.

You say you have worked in insurance but I assume not car insurance as you're just not getting it? Area ratings change frequently, you can only guarantee a quote for approximately 60 day in advance (depending upon the company). What you paid at the start of the policy (and therefore expect to pay on a pro rata basis) is irrelevant.

Pay the difference, or cancel - simples.