unfair charges for a 14 day cooling of period

philoio

I tried to cancel my car insurance the other day within the 14 day cooling off period and was was told it would cost me £40 for admin/the cover i have already enjoyed over those few days AND that the broker would retain their commission which was 13% if the premium!

Can they do this?

poppy_f1

yes they can - it would have been in the terms and conditions when you took the cover out

lisyloo

Yes, none of these people (insurers and brokers) work for free.

Next time I suggest you get organised in advance.
I usually get told off if I say "get a diary" but I do think it's a good idea to put these sort of events into either a spreadsheet or electronic organiser.
Then either look at the policy on-line (many website now have pdfs that you can download on-line) or ask for a specimen policy up front.
If you allow plenty of time then you should be able to check out the policy fully without having to actually take it out.

What's the reason for cancelling?
Is it something you could put up with and continue with the policy?

philoio

Ok that's 2 votes for yes they can. The reason for me wanting to cancel the insurance is since taking out the policy the Mrs has been offered a new job and she requires a car for commuting. The 2 of us currently run 1 car and because neither of us drive to work we have been able to have a sports car as our only car.

The ideal situation would be for us to sell the sports car and get something economical. However my insurance is geared towards performance cars so when i get my new car i will be paying to much insurance. Hence the reason for my change of mind. :sad:

I am a little confused how a diary would help prevent anyone from changeing their mind about their insurance in the cooling off period though?

lisyloo

I am a little confused how a diary would help prevent anyone from changeing their mind about their insurance in the cooling off period though?

No it won't prevent unexpected things happening during the duration of the policy.

It will however allow you to reject an unsuitable policy without fees or hassle and it will also allow you to select one where the admin fees are acceptable to you.
No-one has a crystal ball, but you can check out the costs in advance and reject if you aren't happy with them without any fees or hassle.
So what I'm saying is that you should have checked out the cancellation fees in advance and either accepted or rejected the policy.
I know it doesn't sound sympathetic but the fact is that it is your responsibility to read the documentation you are provided with.
You are responsible for any contracts you agree to.

There are 2 ways of doing it.
Either look at the policies yourself (many are on-line) or pay £1.99 for a guide such as matthews guide where the information is already compiled (www.matthewsguide.co.uk). I believe there is also a legal policy offer.
I have no connection and of course you are free to do the legwork yourself for free if you have the time.

Of course it's always a trade-off between premium price and other issues and personally I think admin fees should rate below price, coverage and service in any list of criteria, however it's an individual choice.

The fact is that the lender and broker did do work and did incurr costs in setting up a policy for you , so they shouldn't have to bear the brunt of the costs when you change your mind.
even if it' isn't you "fault", you are the party that's changing the contract and work has already been done.
These days premiums are kept to a minimum for competitive reasons and admin is charged for on top.
To my mind this is fair on those of us who don't change our minds as we are not being asked to subsidise others that do.
Same as RyanAir charging people for baggage rather than including it in the ticket price.
It means the people that use the service pay and the other do not have to subsidise them.