Car Insurance Cancellation

TheGreySection

https://forums.moneysavingexpert.com/discussion/comment/82112269#Comment_82112269

@MyRealNameToo Any insight would be greatly appreciated.

The above was obviously paraphrasing the conversation.

I am confident that the recording will be abundantly clear that the policy was cancelled at my insistence. Clearly if the insurer had made it clear that my options were (1) pay the additional premium or (2) they would cancel the policy, I would have paid the additional premium.

born_again

I would get a DSAR request in quick, incase the recording gets lost/deleted & there is no transcript to be had🤦‍♀️👍

TheGreySection

https://forums.moneysavingexpert.com/discussion/comment/82112369#Comment_82112369

Done. I also did this during the initial call but have followed up again by email now.

Aylesbury_Duck

https://forums.moneysavingexpert.com/discussion/comment/82112029#Comment_82112029

No, I was referring to the possibility that the insurer considers that they cancelled the policy, and by mucking around, they might confirm that formally and then that's something you'd have to declare every time you apply for a policy, forever. The £80 will pale into insignificance if that happens.

Having read your latest posts, I think that might be where you're at anyway. From your opening post where you said "I realised I hadn't supplied correct information" I inferred that it was you who'd realised, and contacted them to correct the record. Now it's clearer and it seems they alerted you to the error. Paying the £80 might just make the longer-term problem go away. Mucking about might make them record that they cancelled the policy, not you.

MyRealNameToo

This is where there is a weakness in CIDRA as where a non-disclosure and the insurer accepts that it was careless rather than reckless/intentional the legislation doesnt give them the right to increase the premiums but instead says they should reduce claims by the percentage difference in premium.

For some classes of insurance this is fine, you've paid half the premium you should have so you only get 50% of any claim paid. However for classes of mandatory insurance like Motor insurers wont be comfortable with it because they are still the RTA insurer so can be forced to payout 100% of the third party claim and then have to try and recover the £2m or whatever the number is from their insured… at a former client they had a customer repaying over £0.5m at £5 a week. In fairness to the customer, they were paying every week for the last 2 years so only 1,921 years left to go.


Oddly, in my opinion, had the disclosure changed the terms outside of premiums then its considered that the changed terms would have always applied, personally dont see why premiums arent treated in the same way.

If the insurer believes its an intentional or reckless non-disclosure then they have the right to void the policy, avoid any claims and a rather merky statement that they can retain the premium unless it would be unfair to do so.

Generally the FOS considers giving the customer the option to pay the additional premium to reinstate the full limit as a generous option, though worth noting that in most complaints the non-disclosure was discovered at claim stage and the additional premium is substantially less than the increase in claim payment .


The OP is not the first to complain about First Central's fees, https://www.financial-ombudsman.org.uk/decision/DRN6588633.pdf is a fairly similar case which the ombudsman did not uphold. Some do get their complaints upheld but often its on fringe elements however most are where the issue came to light at claim stage


Generally if we were talking about a MTA I would agree with the OP's assessment, they want to make a change, dont like the premium or the insurer says they wont cover the new vehicle/address etc then it is the insured that ultimately has decided to cancel the policy even if their hand was forced. In principle they could decide not to change their address/move address and the policy would continue.

This however isnt the same, the change is backdated to the date of inception because its not a change but how things always should have been as such there is no option to say you dont want to pay the premium and to cancel it. "I'm not going to pay" therefore can be taken as a refusal to pay the premiums that were due for the time already on cover. I'm not sure if the agent would have the tools to be able to tell them if they had paid the £250 and then immediately cancelled afterwards what the return premium would have been as that then would have been a customer cancelation, reduced the fee and a refund would still be due on the unused elements of the premiums paid.

TheGreySection

I think it is worth regular contributors to this forum being aware of other people's experiences of 1st Central.

Here are their Google reviews that tell a similar story to mine.

Their business model clearly relies on trying to catch people out on the information provided and then price gouging leaving people facing a choice of a vastly inflated premium or spurious cancellation fees.

Interestingly when I was looking at new insurers with all the correct information included, 1st Central were listed for around the original premium quoted rather than the inflated premium they were trying to subsequently charge me.

Any advice on what I can do if they insist that they cancelled the policy despite the fact it was categorically cancelled at my request? I am assuming the call conveniently won't have been recorded despite checking and being told it was on the call.

Grumpy_chap

Many thanks MNRT, it sounds like the OP is holding a high-7 and 1stC a straight-flush.

Jumblebumble

https://forums.moneysavingexpert.com/discussion/comment/82112796#Comment_82112796

I would hope that the ombudsman would take an extremely dim view of an insurance company breaching their duty to treat customers fairly by saying you did not disclose but we are willing to overlook this if you pay £250 but if you don't pay we will make you suffer for ever.

If I were the OP I would pay the money to avoid debt collectors and get clarity from ICT as to who cancelled the policy as call centre staff can easily make mistakes

I know of a situation with a Landlords insurance policy when Amex gave a one off 10% discount for a single payment once a year

The person had 2 flats and insured one them with 1 Amex transactions before inception

They cancelled and the insurer charged the Amex £15.00

The resulted in a complaint and I quote verbatim from the email

Thank you for your time on the phone with my colleague Sam. I understand you raised a complaint regarding being charged a £15 cancellation fee, prior to the policy start date, contrary to the terms and conditions.

Following a review of our terms and conditions, this £15 fee has now been refunded back to you.

I'd like to thank you for your feedback and for bringing this to our attention and I can assure you that the terms and conditions will be reviewed of the back of this as a priority.

Further to our previous communications, we now consider your complaint to be resolved.

If you subsequently decide to escalate this, you have the right to refer your complaint to the Financial Ombudsman Service (FOS), free of charge – but you must do so within six months of the date of this communication.
If you do not refer your complaint in time, the FOS will not have permission to consider your complaint and so will only be able to do so in very limited circumstances (for example, if the FOS believes that the delay resulted from exceptional circumstances).

Further details regarding the FOS can be obtained from their website here. Alternatively, the FOS may be contacted at:

The Financial Ombudsman Service
Exchange Tower
London
E14 9SR
Tel: 0800 023 4567

flaneurs_lobster

Their business model clearly relies on trying to catch people out on the information provided and then price gouging leaving people facing a choice of a vastly inflated premium or spurious cancellation fees.

or conversely

Their business model relies on confirming the information that the applicant has provided (and declared to be true) and in those cases where there has been a failure to disclose information they will offer to continue the cover at a much higher premium or to cancel the policy on payment of a large cancellation fee.

Fair? Reasonable? Matter of opinion.

Legal, within the regulations? Yes - until the regulator says otherwise.

Aylesbury_Duck

https://forums.moneysavingexpert.com/discussion/comment/82112812#Comment_82112812

It's the Ryanair model. Everything is fine as long as you strictly adhere to all parts of the process, but if you mis-spell a name, your suitcase is 2cm too wide or you forget to download your boarding pass, you pay for it. The model keeps prices low for the majority. It will continue as long as people continue to purchase on grounds of price alone. The difference between a budget policy and a decent policy can be very significant should you need to make a claim.

If they insist that they cancelled the policy then you should insist on the call record. Assuming it shows that you cancelled the policy (or is at least ambiguous about who cancelled it) make a formal complaint and if that doesn't address it, take it to the ombudsman. The outcome you need is to not have an insurer cancellation on your record.