Replacement car insurance wows

pip911

Hello to the hive. 

My car is covered by Tesco and was recently written off by a drink driver, his insurance paid out no bother. My insurance stated I have to carry on paying my premium as it was paid monthly or pay it off in full. They said when I find a new car it will be easy to add onto my current policy so I left it as it was. 

I have since found another car and asked to add it. 

My last car was a 1998 mgf 143 horsepower, the new car is an 2002 mgtf 160 horsepower, same make,, same body just a facelift model and 17hp more. 

Previous policy cost £188.17 renewed on 4th may 25. 

New car became £168.02
Tesco told me combined cost is £356.19. 

Is this the right way of doing it as I’m paying two lots of premiums on one policy. I thought it would just be the difference between the two cars, maybe £50 or something. 

Heeeelp please

Alderbank

When you take out a policy the full annual premium is due to the insurer. You either pay immediately as one single payment or you take out a loan with a third party who pay the full premium on your behalf. You repay that loan, with interest, in monthly repayments.

If a vehicle is written off the policy ends. Don't grumble about that - you have had really good value from that policy; you paid a couple of hundred for it and they have had to shell out thousands. However for anyone who had taken out a loan to pay the premium there might still be loan payments due.

You were a bit unlucky in that you had your accident less than two months into the new policy. If your accident had happened back in April you would not have had to pay any balance of payments on last year's loan.

I suppose the advice is, make sure you have all your accidents in the final month of your policy!

Altior

Will be factoring the cost of the new premium, with a recent accident and the change of vehicle. Plus possibly admin charge. Not two premiums. 

You could run a new comparison for the new car, declaring the non fault claim, and see what the market is offering. Then maybe see if Tesco will budge (depending on like for like quotes)

cw8825

The accident won't be factored in. 
It's just the premium for the change of car. 
However if it's a non fault claim and your insurance hasn't been involved or has the money back, you shouldnt be paying for both policies

maman

I'd have thought you could continue to pay your old policy with an upgrade for the new car. That's surely what would have happened if you just changed your car mid policy. 🤔 I don't have any experience of paying monthly but you're not trying to get out of paying your old policy instalments just upgrading it. Personally, I'd get back to the Company and ask them to explain. 

Peter999_2

This is exactly how the insurance works.   As has been said, the premium is due in full at the beginning of the policy and they lend you the money which you pay back monthly.

Once you claim for the written off car the policy finishes.  However, you still have to pay back the loan until fully paid off.     You have now added the new car to the policy so again the full amount is due and they loan you the money for it to be paid back monthly. 

You are then paying both the loans back monthly which makes it feel to you like you are paying double but you aren't at all.

maman

Thanks for the information @Peter999_2. As I said, I've no experience of monthly payments but as you say the policy ends when the car was written off then it makes some sense.

Just out of interest though, if I'd paid up front for a year and the policy was cancelled then I'd expect a refund. (I'm basing this on my home insurance when I had to get alternative specialist cover while building work was a going on.) Does this not happen with motor insurance? 🤔

sheramber

How long was there between the car being written off and insuring you new car?

When our car was written off - an own fault claim- Tesco  allowed one month to replace the car on the existing policy. 

After a month it was a new policy.

Peter999_2

maman said:

Thanks for the information @Peter999_2. As I said, I've no experience of monthly payments but as you say the policy ends when the car was written off then it makes some sense.

Just out of interest though, if I'd paid up front for a year and the policy was cancelled then I'd expect a refund. (I'm basing this on my home insurance when I had to get alternative specialist cover while building work was a going on.) Does this not happen with motor insurance? 🤔

No, you wouldn't get a refund with the motor insurance.   It did it's job and paid out for it and therefore the policy finishes.      It does make sense really.

Peter999_2

sheramber said:

How long was there between the car being written off and insuring you new car?

When our car was written off - an own fault claim- Tesco  allowed one month to replace the car on the existing policy. 

After a month it was a new policy.

You did very well there.   According to Tesco's terms and conditions here - tesco-car-insurance-all-policy-booklet-1112.pdf that shouldn't have happend and the policy is ended when you have a total loss on your car (it states in there that if you pay monthly you have to carry on paying and if you pay yearly you don't get a refund.

You saved yourself a lot of money.

Saying that, it does say that they MAY allow the policy to run for another 28 days so you can put a replacement car on the policy so I guess this is what they used for you.      I've never heard of any insurance company doing that before.

sheramber

Peter999_2 said:

sheramber said:

How long was there between the car being written off and insuring you new car?

When our car was written off - an own fault claim- Tesco  allowed one month to replace the car on the existing policy. 

After a month it was a new policy.

You did very well there.   According to Tesco's terms and conditions here - tesco-car-insurance-all-policy-booklet-1112.pdf that shouldn't have happend and the policy is ended when you have a total loss on your car (it states in there that if you pay monthly you have to carry on paying and if you pay yearly you don't get a refund.

You saved yourself a lot of money.

Saying that, it does say that they MAY allow the policy to run for another 28 days so you can put a replacement car on the policy so I guess this is what they used for you.      I've never heard of any insurance company doing that before.

Even better we replaced it with a newer model of the same car.

Our renewal the following year was less than we had paid the previous year, despite the fault claim.