Car Insurance non-declared points

rejory

I had been getting my car insurance updated automatically by direct debit and had not updated my fixed penalty points with my insurers. I have 6 points but had 9 until a few months ago (all incurred on empty roads in the early hours when coming home from work - no excuse I know!)
When I attempted to make them aware they said I then owed them 987 pounds backdated for the last three years plus next year's premium of 755 pounds (up from 260).
I said of course I was unable to pay this and wish to cancel my insurance. They said I would still owe the 987 pounds and if I didn't pay they would send round the debt collectors.
I spoke to a manager who said he would see what he could do and would call me back. Of course he hasn't and I'm now wondering what course of action I can take?

DaisyFlower

If you didn't tell them of the points at the time or at the next renewal then they can pursue you for this debt as they would have loaded the renewal accordingly each year had you told them.

Cancelling your insurance would still render the monies due. I would see about a payment plan if you cant afford the whole amount in one go.

nickmack

rejory wrote: »

I spoke to a manager who said he would see what he could do and would call me back. Of course he hasn't and I'm now wondering what course of action I can take?

As previously stated, you will need to make arrangements to pay the £987. Intentionally or not, you have misrepresented the risk. The insurer has been covering you, so they will want paying. You may be able to get them to reduce this figure, but don't rely on it.

Don't just ignore this or you could find yourself with a default. Furthermore, the insurer may place a note on the insurers database about the policy and you will then find premiums increase further, if you can get one at all.

Oscar_The_Grouch

Hi there,

When you take out insurance (including at each annual renewal) you are required to tell your insurers of any changes to your circumstances. They are under the same obligation and have to tell you about any changes they are making to your policy that could affect the cover they provide. This is the "disclosure of material facts".

Let's face it, that's only fair!!

When they send you the renewal details, they will tell you what information they are basing it on. If you do not tell them it has changed (if you were insuring a 2 bed semi in Bath and then moved to a 2 bed semi in the centre of London, the risk has changed. In your case, you have gone from "clean driver" to "one SP30 short of a ban"), they do not know. Insurers are quite nice and rather than calling this "fraud" they call it "non-disclosure".

The key here is whether you have made any claims during the time you have been with your insurers. If not, then you may be able to strike a deal. If you have, make arrangements to pay them the premium you owe them and live with it. If not:

1. Call your insuurer (not the broker - look for the name of the insurer on the certificate).
2. Give them your policy number or the "certificate" number off your certificate of motor insurance and say that you need to speak to the Manager of the Underwriting Department or the Manager of the Complaint Department. Don't speak to anyone else and if they will not put you through, ask for the address of the Managing Directors Office.
3. Explain to them that you did not realise that you should have told them about the points on your licence. Tell them that you do not have the money to pay them the premium they are asking for and suggest that if you "lapse" (cancel from renewal) your policy, as you want to anyway, you will not have to refer the matter to the Financial Ombudsman if they agree to waive the outstanding premium from the prior years. They should agree as it will cost them more to chase you than to write it off. At worst, ask them for a breakdown in the costs by year and offer to pay 50% of the last years additional premium.

Now, I have been criticised for telling people to go to the Ombudsman before because it costs the insurers money (£400+ a pop) and could result in the Ombudsman deciding to charge policyholders in the future for new complaints. I don't think the insurers or Ombudsman could get away with this (you don't pay to submit a question to any other ombudsman), so give it a go!!

Remember, before you can refer to the Ombudsman, your insurer MUST have sent you a "final decision letter", otherwise they can delay by up to 8 weeks. If your insurer is not willing to waive the money, ask them for their final decision letter, including the "you and the Ombudsman" leaflet that you are entitled to.

The final decision letter (according to the FSA DISP Handbook - which is available on line at http://fsahandbook.info/FSA/html/handbook/DISP) must confirm that it is the final decision of the insurer, that if you are not satisfied you may refer to the Financial Ombudsman Service and that you only have 6 months to do this from the date of their letter.

Good luck and let us know how you get on.

mattymoo

Oscar_The_Grouch wrote: »

Hi there,

When you take out insurance (including at each annual renewal) you are required to tell your insurers of any changes to your circumstances. They are under the same obligation and have to tell you about any changes they are making to your policy that could affect the cover they provide. This is the "disclosure of material facts".

Let's face it, that's only fair!!

When they send you the renewal details, they will tell you what information they are basing it on. If you do not tell them it has changed (if you were insuring a 2 bed semi in Bath and then moved to a 2 bed semi in the centre of London, the risk has changed. In your case, you have gone from "clean driver" to "one SP30 short of a ban"), they do not know. Insurers are quite nice and rather than calling this "fraud" they call it "non-disclosure".

The key here is whether you have made any claims during the time you have been with your insurers. If not, then you may be able to strike a deal. If you have, make arrangements to pay them the premium you owe them and live with it. If not:

1. Call your insuurer (not the broker - look for the name of the insurer on the certificate).
2. Give them your policy number or the "certificate" number off your certificate of motor insurance and say that you need to speak to the Manager of the Underwriting Department or the Manager of the Complaint Department. Don't speak to anyone else and if they will not put you through, ask for the address of the Managing Directors Office.
3. Explain to them that you did not realise that you should have told them about the points on your licence. Tell them that you do not have the money to pay them the premium they are asking for and suggest that if you "lapse" (cancel from renewal) your policy, as you want to anyway, you will not have to refer the matter to the Financial Ombudsman if they agree to waive the outstanding premium from the prior years. They should agree as it will cost them more to chase you than to write it off. At worst, ask them for a breakdown in the costs by year and offer to pay 50% of the last years additional premium.

Now, I have been criticised for telling people to go to the Ombudsman before because it costs the insurers money (£400+ a pop) and could result in the Ombudsman deciding to charge policyholders in the future for new complaints. I don't think the insurers or Ombudsman could get away with this (you don't pay to submit a question to any other ombudsman), so give it a go!!

Remember, before you can refer to the Ombudsman, your insurer MUST have sent you a "final decision letter", otherwise they can delay by up to 8 weeks. If your insurer is not willing to waive the money, ask them for their final decision letter, including the "you and the Ombudsman" leaflet that you are entitled to.

The final decision letter (according to the FSA DISP Handbook - which is available on line at http://fsahandbook.info/FSA/html/handbook/DISP) must confirm that it is the final decision of the insurer, that if you are not satisfied you may refer to the Financial Ombudsman Service and that you only have 6 months to do this from the date of their letter.

Good luck and let us know how you get on.

Well the cost affects the insurers bottom line and since they are a business, not a charity, the costs are passed on to all the other policy holders.

I have asked the board mods to look at your post. While the advice is not illegal, it is proposing an open abuse of the ombudsman scheme to avoid paying a debt.

DaisyFlower

Why should the insurers waive the charge, its owed to them for non disclosure.

Frankly your advice might not be illegal but is certainly immoral.

Whats not to say the OP took a gamble in not disclosing his points to keep his premiums low? I'm not saying he did but we have limited information and its a scenario that could have happened.

Most people know to make their insurers aware of speeding fines and are aware it can affect the premium so the OP should hold his hands up and set up payment terms for the amount owing.

Zebedee69

tom188 wrote: »

#3 looks like spam to me

Doubt it... That website is a large one and its not a affiliate link. Its prob just a helpfull person.

Anyway, I used to work for Elephant.co.uk and yes you will have to pay. If you dont they will default you and list your details on the Motor Insurance Register as a fraud case (attempting to understate the risk) and believe me you dont want that as you can pretty much say goodbye to car!

Hope that helps! You must pay, see if they will do a payment plan. You know it makes sense. They should accept that if you willing to pay:beer:

Trojan1965

Hold on here !! Accepted that non-disclosure is a material fact and should the OP havebeen involved in an accident, the insurer would well be within their right to charge the additional premium or actually void the policy. However, what they cannot now do is backdate the loading to previous years. Motor insurance is an annual contract therefore the insurers can only load the premium for the current year i.e. since your last renewal.
providing you have not been involved in any claim/accident etc and you have not renewed the policy then do not pay the AP. They cannot persue if the policy has now lapsed ( or if current - only to last renewal date).
Brokers are just trying it on with you. Out of interest who are brokers/insurers ?
I suggest you ring the broker & state the above & advise what reaction you get.
Any problems please state here & I can advise/help further.

Zebedee - I currently work in the motor insurance industry ( underwriting and broking )and have done so for 20+ years.

Trojan

MountainMan101

If the original poster had been involved in an accident (supposing he was clearly responsible), would the insurer have paid out or claimed he was uninsured due to not letting them know.

If they would have paid out then I think he should pay them the money owed. If they would have got out of it - which would have looked very tempting if the crash was tens of thousands of pounds, then I think they should refer the matter to the police and ideally he'd lose his license for driving uninsured.

Philip

nickmack

MountainMan101 wrote: »

If they would have paid out then I think he should pay them the money owed. If they would have got out of it - which would have looked very tempting if the crash was tens of thousands of pounds, then I think they should refer the matter to the police and ideally he'd lose his license for driving uninsured.

My guess is they would pay out as long as the shortfall in premiums was paid up. I think if they refused, the ombudsman may rule against them, unless possibly they can show they don't insure drivers with that level of risk.

Which brings the question to the OP, if you had been involved in an accident and had disabled someone, possibly facing a compensation payout of hundreds of thousands, would you pay up the additional premium if the insurers would deal with the claim for you?

Jada

Trojan1965 wrote: »

Hold on here !! Accepted that non-disclosure is a material fact and should the OP havebeen involved in an accident, the insurer would well be within their right to charge the additional premium or actually void the policy. However, what they cannot now do is backdate the loading to previous years. Motor insurance is an annual contract therefore the insurers can only load the premium for the current year i.e. since your last renewal.
providing you have not been involved in any claim/accident etc and you have not renewed the policy then do not pay the AP. They cannot persue if the policy has now lapsed ( or if current - only to last renewal date).
Brokers are just trying it on with you. Out of interest who are brokers/insurers ?
I suggest you ring the broker & state the above & advise what reaction you get.
Any problems please state here & I can advise/help further.

Zebedee - I currently work in the motor insurance industry ( underwriting and broking )and have done so for 20+ years.

Trojan

Although I don't work in insurance nor am I qualified in law, I would've thought the contract between you and your insurer became void after you failed to inform them of your first three penalty points. Thus, I doubt you could pull off the notion that as "motor insurance is an annual contract therefore the insurers can only load the premium for the current year i.e. since your last renewal" as the insurer relied abd took any information it had, from you, for each year, in good faith. You broke each 'contract' without their knowledge and they should receive back dated funds as it would've cost you this 'extra' had you done the lawful thing of providing the information in the first place. You used the service, thus you must pay for it.

It really isn't unreasonable for the insurance company to ask for this money as you, whether through ignorance or deceipt, omitted to provide fundamental information.

And to be honest, if you don't pay up, you should be prosecuted for driving for x years (is it three?) without insurance.

Three points on your licence, ok, everybody makes a mistake, but nine?? I would certainly think twice about getting into a car with someone who has been recklessly driving AND caught three times, and would be disgusted with them for not having valid insurance. It's your responsibility to make sure your insurance is valid each time you drive.

I really wish people wouldn't be so tight and stop trying to squirm out of paying what's due for the cover needed. How would you feel if your mother was a passenger in an accident with you and your insurance wouldn't pay up because you decided to massage the truth?

Sorry, but the truth hurts. I'm sure most people resent the cost of VALID car insurance, but it's there for a reason.

:staradmin Jada :staradmin