Car Insurance Cancellation Fees

Nurselayer

Hi all,

I recently renewed my classic car insurance (in October), then I sold the car and so don't need the insurance any more.

My insurance (including cost of paying by monthly payments) was £133.61 for the year.

So far I've made two monthly payments, one of £15.51 and one of £11.81. I also paid £44 for breakdown cover but cancelled this within the "cooling off period", although the insurance company have retained the money.

When I rang to cancel the insurance they initially told me that I would have to pay £182 to cancel the insurance. I pointed out that this was more than the full cost of insurance but was told that I was wrong. I then asked for a senior manager to ring me back. When they rang me back they agreed that that figure was wrong. I'd had 53 days cover and so the insurers would want 40% of the premium. She then said that with fees etc that would come to £105.47!

I told her that for that little amount of refund that I didn't want to cancel then until this was resolved. They've just sent me a letter telling me that they are cancelling my insurance at the insurers behest.

Where do I stand on this? I have already cancelled the standing order/Direct Debit to pay monthly.

I think that if it was fair I'd pay £133 x 40% at most = £53.44

All help gratefully appreciated.

AdrianC

You bought a £133 annual policy.
You then took finance out to pay for that policy. Repaying the finance and cancelling the policy are two different things.

Cancellation outside the 14 day cooling-off period is always more expensive than a simple pro-rata refund. Any policy fees can be charged in full, and when the premium is very low, it can work out to be a very large percentage of the full premium. If you're paying monthly, that can easily mean that you owe them money to cancel, yes, even before considering any finance charges for the pay-monthly finance.

Remember that if you do not cancel the policy, you may still be liable for the car, because you are the policyholder for a policy that is on record with the MIB.
https://www.dailyrecord.co.uk/news/scottish-news/scots-biker-insurance-hell-after-4141840

Inner_Zone

Nurselayer wrote: »

Hi all,

I recently renewed my classic car insurance (in October), then I sold the car and so don't need the insurance any more.

My insurance (including cost of paying by monthly payments) was £133.61 for the year.

So far I've made two monthly payments, one of £15.51 and one of £11.81. I also paid £44 for breakdown cover but cancelled this within the "cooling off period", although the insurance company have retained the money.

When I rang to cancel the insurance they initially told me that I would have to pay £182 to cancel the insurance. I pointed out that this was more than the full cost of insurance but was told that I was wrong. I then asked for a senior manager to ring me back. When they rang me back they agreed that that figure was wrong. I'd had 53 days cover and so the insurers would want 40% of the premium. She then said that with fees etc that would come to £105.47!

I told her that for that little amount of refund that I didn't want to cancel then until this was resolved. They've just sent me a letter telling me that they are cancelling my insurance at the insurers behest.

Where do I stand on this? I have already cancelled the standing order/Direct Debit to pay monthly.


I think that if it was fair I'd pay £133 x 40% at most = £53.44

All help gratefully appreciated.

Not your request? If so at their request you may have to declare it for a number of years and it may impact on your non classic vehicle insurance it you have any, and on any future insurance costs.

Nurselayer

Well they are saying that they are cancelling it because I've told them that I've sold the car.

Quentin

Yes. That is correct


You changed the goal posts by cancelling.


Check the policy wording over cancelling the breakdown addon - usually there is no refund on addons

foxy-stoat

If you were to keep the insurance running when you have sold the car you are leaving yourself and the insurers open if there was an incident outside of your ownership.

Your better off insuring another classic car that is 100% not going to be driven on the road, if you know of one.

AdrianC

Nurselayer wrote: »

Well they are saying that they are cancelling it because I've told them that I've sold the car.

Yes, the risk no longer exists, so the policy is no longer required.


They're doing that to protect you.


And, no, that's not the kind of cancellation that you need to declare...

MEM62

Nurselayer wrote: »

I told her that for that little amount of refund that I didn't want to cancel then until this was resolved.

Big mistake. Do not leave insurance coverage on a vehicle that you have sold.

https://www.whitedalton.co.uk/motorbike-blog/2013/10/i-sold-my-bike-but-didnt-cancel-my-insurance/