Car Insurance - new admin fee for cancelling WITHIN 14 day cooling off

[Dipply75]

I have the 'pleasure' of working for a very well known car insurer where most of the policies are bought through a call centre or online. They have just introduced an 'admin fee' as they are calling it if a customer cancels anytime within their 14 day cooling off period - even same day.

 

Now I thought the Distance Selling Regulations had some bearing there but I was told apparently not when I raised this. Any thoughts as I think this is ridiculous (one of many tbh!) and if so, something needs done to nip it in the bud methinks.

 

thanks x

[Crocdoc]

I have taken this information from an extremely reliable source, it may not be what you would like to hear, but unfortunately it is the way it is.

 

Many policies contain an automatic cooling-off period whereby they may be cancelled by the client within 14 days for general insurance and 30 days for life insurance. The insurer is allowed to charge something for their administration costs, but they are not allowed to benefit from this charge

 

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[Dipply75]

Aha, thankyou crocdoc. Which is quite reasonable as there is obviously admin involved. Flat fee of £26 charged, £55 after those 14 days. Good to know, thanks

[Crocdoc]

Well there we are, this raises serious questions about the higher fee could it now be argued that this is a penalty and therfore recoverable.

[Dipply75]

Well its a helluva jump. The issue I have with it is, if you take a policy online say, then cancel that later that day...the only admin was the automatic print of docs and phoning us to cancel it. So none of these big initial set up costs stated. The £55 is charged after that in the first year then drops to £27.50 if you renew into a 2nd year.

 

Interestingly, should you renew year on year for few years but then get a cheaper quote online, cancel your renewal but still take another policy all online and stay a customer, the £55 first year charge then applies? That to me is being penalised.

[Phil2011]

I have taken this information from an extremely reliable source, it may not be what you would like to hear, but unfortunately it is the way it is.

 

Many policies contain an automatic cooling-off period whereby they may be cancelled by the client within 14 days for general insurance and 30 days for life insurance. The insurer is allowed to charge something for their administration costs, but they are not allowed to benefit from this charge

 

If you have found my post helpful please click the star to the left of my profile –

Thank You

 

 

I bought car insurance through One Call and cancelled 2 days later before the policy even began, today I got a letter stating there would be a £49 admin charge for cancellation, despite the full cover being £271 !! After calling the company the employee I spoke to said that this amount is in the terms & conditions and so there's nothing I can do about it and I'd be wasting my time complaining.

Am I entitled to ask for documentation proving that admin fees did come to £49 and hence proof that they indeed did not profit from the admin charge as stated above?

 

Would be very grateful for any help.