Cancelled Car Insurance Admin Fee Rip Off

JuShepp2013

Due to lack of income in recent months, we sold our 2nd car.  Telephoned Direct Line to cancel the car insurance a month ago, just checked my bank account to see that they have taken £49 from my bank account, apparently to cover admin fees !  Talk about a rip off.  This is causing another financial headache we do not need.  Can I appeal this cost ? 

Sandtree

You can but you are unlikely to get anywhere.

The cost is a cancellation fee not just an admin fee, though that is in part what it covers, it also covers things like policy setup costs. Similarly the fee is a blended rate, ie everyone pays the same, so whilst you may think its reasonable to recover £50 when they've paid out £75 in marketting costs a few days earlier if you cancel a new business policy a few days after the cooling off ends but harsher if you cancel a renewed policy after 11 months... the former are much more common though.

The FCA challenged insurers over a decade ago to justify the costs and at the time anything under £60 was considered reasonable so add a decade of inflation and so a higher fee is probably justifiable.

neilmcl

JuShepp2013 said:

Due to lack of income in recent months, we sold our 2nd car.  Telephoned Direct Line to cancel the car insurance a month ago, just checked my bank account to see that they have taken £49 from my bank account, apparently to cover admin fees !  Talk about a rip off.  This is causing another financial headache we do not need.  Can I appeal this cost ? 

Of course it's not a rip off. They're running a business not a charity, if you want them to perform a service, such as cancelling your policy, then you should expect to pay for it. £49 is not exactly unreasonable.

[Deleted User]

JuShepp2013 said:

Talk about a rip off.  

Talk about a failure to understand the policy you bought.

Aylesbury_Duck

The fee will be in the terms and conditions you agreed to when taking out the policy.

neilmcl

You would've thought the OP would be used to this by now - https://forums.moneysavingexpert.com/discussion/4731256/jushepp2013#latest 🙄

mattyprice4004

Read the small print. 

It applies to pretty much every insurance company. 

Flight3287462

Were you paying the policy via monthly installments?  If so then the finance element needs to be settled too.

photome

Wow 2 posts in 7 years both complaining  about a £49 charge

DCFC79

Lets hope the OP comes back to respond.

littleboylost

Hi - Recently took out new car insurance with Hastings Direct using Money Supermarket to obtain my quote.  Hastings now claim that I told them had 7 years no claims discount when in fact I had 8 years.  They now want to charge me £34 to change this.  I can't even remember if they are correct in saying I told them I have 7 years ncd.  Despite this I believe this very unfair and exploitative.  Furthermore, if the quote was based on 7 years ncd when in fact I have 8 years ncd surely this should be taken into account??

Anyone else have this problem?  What can I do about it to avoid pay this extortionate charge?