Car insurance costs: beware charges and fees guide

[tali]

Found this handy guide -to the charges car insurance companies sting you with.

Car insurance costs: Fees and charges - How it works and what it covers - Car insurance - Insurance - Which? Money

 

[geraldrobins]

As with any purchase the cheapest isn't always the best value. You need to do some research and think of the what ifs.

 

[Doodle]

I cancelled the policy on my Landcruiser today as the new owner picked it up last night. It lapses sometime next week.

"Certainly sir, that will be £40 cancellation fee"
"For something that has a week left to run? That seems a little excessive, that's 10% of the premium. It's not like I'm expecting a refund, so exactly what costs will you be incurring?"

Cue a minute of self-justifying waffle and bullsh*t

"Well, let me put it this way. I ask to cancel it. You try and charge me. I inform you that it's an unreasonable charge, refuse to pay and escalate it to the ombudsman. By the time they conclude investigations, the policy will be long since lapsed, I probably still won't have paid you anything and it'll have cost you several times as much in fees. Does that sound accurate?"
"We'll lapse the policy without charge, sir"
"I thought you might"

 

[tali]

I think it that situ it is best to suspend the insurance and let it lapse ,rather than cancel

 

[Doodle]

Either option would have been acceptable - it wasn't like I was going to get any money back, but the vehicle isn't mine now and so I have no interest in any form of liability towards it.

However, suspension wasn't offered to me at the time, it was cancellation or nothing.

 

[Primo]

Some of these charges are clearly outrageous, however, the writer of the 'Which' article does not distinguish between insurer charges and broker (that is any firm that is not an insurer) charges. Two examples:

1) If the risk changes the premium may change. Just because an insurer is competitive on a particular combination of particulars does not mean that they will be competitive if you charge one or more of those particulars. The charge or refund for the change will probably, but not always, originate with the insurer. This charge may increase or the refund decrease by virtue of an adjustment fee that should serve to cover the cost of processing the adjustment. I think the size of some of the fees charged will be the subject of an FCA investigation at some point in the future.
2) Cancellation. Outside the cooling off period cancellation is either 'short-period' or pro-rata and is stated in the policy wording. Typically, but by no means always, an insurer will weight a refund in their favour in the first year. This is called 'short-period. After the first year of cover you should 'typically' get a pro-rata refund. Either way these refunds will be further reduced by 'broker' charges.

 

[tali]

I asked Aviva if i cancelled within a specific time , how much refund would i get back and they were unable to answer on the phone.And no insurer has any info online.Can't be that complicated ? Why the secrecy ?