Help please on cancelling insurance

Davesquire

Hi, I hope that this is the correct thread.

Attempting to buy new car insurance - wasn't aware of how much this has increased😲! Cheapest recommended was Marshmallow - no mention of requirement to use app, until it came to paying. They also wanted to use a verification system to log into my bank account and remain monitoring it!

The only way to cancel is through their app. If you cancel within 14 days, there's apparently an admin charge? I didn't think that this was legal? Can anyone help clarify this.

Thank-you.

Woodstok2000

The bank connection is just to verify your details, very straightforward and secure, and explained here:

https://www.marshmallow.com/article/why-do-i-need-to-connect-my-bank-account

They can charge an admin fee in the cooling off period and pro-rata daily costs if cover has started but only if it is stated in their terms and conditions.

I am confused though, you cant take out the insurance without the bank connection, so if that was your issue why did you continue to buy the policy?

flaneurs_lobster

So why do you want to cancel, the driving monitor by app or the bank account verification?

Can't believe that both of these requirements weren't apparent before you paid?

MattMattMattUK

https://forums.moneysavingexpert.com/discussion/comment/82177695#Comment_82177695

Having had a look, the app monitoring is up front, the requirement to share Open Banking data is only clearly stated after the policy has been purchased, before that it is buried deep in the terms and conditions.

Woodstok2000

https://forums.moneysavingexpert.com/discussion/comment/82177707#Comment_82177707

Are you sure? This seems to imply you cant buy a policy without the open banking link:

https://www.marshmallow.com/article/why-do-i-need-to-connect-my-bank-account

Especially where it says you are free to stop if you don't want to share your details. Sounds like a step in the purchasing process rather than something completed afterwards.

MyRealNameToo

https://forums.moneysavingexpert.com/discussion/6687736/help-please-on-cancelling-insurance

Unfortunately you are wrong, the regulations state they must allow you to cancel the policy in the cooling off period not that it has to be fee free. In principle after the cooling off period you have no statutory right to cancel at all though in practice all motor insurers are going to allow you to do so.

Fees have to be proportional to the costs they have incurred, they cant charge you a £2,000 cancellation fee on a £500 policy. That said, a blended rate is not only allowable but is preferred as up front they can set the cost of cancellation and everyone can see that before they buy whereas if it were personally calculated it could only be expressed as a range which creates uncertainty which regulators dont like.

Selling insurance is an expensive game and many of those costs will be unrecoverable just because you decided to change your mind.

Davesquire

https://forums.moneysavingexpert.com/discussion/comment/82177907#Comment_82177907

In this particular case though, I was attempting to cancel the policy process, which I was unable to do until the following morning by downloading their app and talking to the bot. Yes, whilst completing the aplication process online - your only course of action if you need to contact them is to download the app and "Live chat".

Whatever happened to customer rights in this country?

"Selling insurance is an expensve game". Sorry but, insurance companies aren't exacty short of a few bob otherwise they would not be in the industry. I think that the problem is that there are so many companies involved that it has diluted the profit. But for many years, the larger companies were raking it in.

Davesquire

https://forums.moneysavingexpert.com/discussion/comment/82177740#Comment_82177740

Yes. This baffled me as well. Anyhow, i then went and completed a simple process with another company and obtained insurance in seconds. Just shows.

flaneurs_lobster

https://forums.moneysavingexpert.com/discussion/comment/82178005#Comment_82178005

Still not really understanding their process, Marshmallow are a low-rent "Digital First" player, they use that Open Banking connection for ID verification because presumably it's cheaper than the other ID check services.

If they can't make that OB connection (because you don't have online banking or you say No) then you ain't getting insurance.

MyRealNameToo

https://forums.moneysavingexpert.com/discussion/comment/82178004#Comment_82178004

So thats their loss not yours, you agreed to buy the contract that had a £25 (or whatever it is) cancelation fee during the cooling off period. Doesnt matter if you cancel it 10 seconds after buying it or 10 hours later the fee remains the same. So the delay may have cost them more but it hasnt changed your cost.

UK/EU probably has the most customer rights as anywhere in the world. Most would argue its too nanny state and indeed in part those rights are what pushes our prices up as a cost incurred by a business is pushed back to the consumer ultimately.

An insurer could have fee free cancellations, but they are still incurring those costs irrespective so the question is should the person that incurred the cost have to pay it or should everyone else? Generally the regulator things fees are better targeted at those causing the cost than pushing up everyones premiums. What they guard against is excessive fees which are unrelated to the actual cost to the business on an average basis.

Im not saying you should be feeling sorry for them but ultimately your decision to back out has a cost that someone has to pay. That cost is likely to be notably more than you think it is as I suspect you dont realise that, for example, many Policy Admin Systems charge the broker/insurer a fee for every policy written using it, and some even for every quote generated.

flaneurs_lobster

 Most would argue its too nanny state and indeed in part those rights are what pushes our prices up as a cost incurred by a business is pushed back to the consumer ultimately.

I wouldn't so argue, what's your source for claiming I'm in a minority?