Car insurance annual payment query

Neil · May 8, 2013

12 months ago I insured my daughters car on the phone giving my Visa Debit Card details for payment of 12 months cover.
We went online a few weeks ago and and insured her car again with the most competitive quote, no problem with that.
Then this week the Insurance firm who my daughter was insured with last year takes another annual payment out from my Visa Debit card they used last year.
Question I am asking is ,surely this is illegal without contacting me 1st ??
In any case they never even contacted me to ask if their quote was OK (which it wasn't it was double the quote I got elsewhere).
They said because I hadn't contacted them they presumed I wanted to stay with them, no email, nothing .
Anyway I caused a stink and got a full refund as I proved that I was insured elsewhere.
Anyone else been caught out by this??

Uncle Spielberg · May 8, 2013

It is an ongoing arrangement unless you cancel it so it is within their rights, much the same as BHAFC carrying on the dd for next season.

Wardy · May 8, 2013

If you look closely at the T&C's you will more than likely find a line that says something like "Unless you inform us in advance we will assume that you wish to continue to be insured by us at the end of the current term, when that time comes you will be insured on the same conditions as you are now at our best price."

Sneaky but legal.

Gullster · May 8, 2013

Yep, Direct Line sent me a horrendous quote advising I need do nothing as they would auto renew. I contacted them and advised them I would be insuring elsewhere. After a bit of haggling they knocked nearly £100 of the price and ended up the best quote. I asked them how they could do that and they said that they could offer various discounts to keep existing customers. Why they don't do that to start with is anybody's guess. I accepted their quote and ensured auto renew was cancelled for next year. It pays to be on the ball and react as it seems they hope people can not be bothered and just accept their renewal letter.

beorhthelm · May 8, 2013

name and shame, poor form. my insurer writes at least once if not twice to remind me the next year is due and they'll take it from the card they have on record on such date if i dont cancel.

Neil · May 8, 2013

it was Bell Insurance and they didnt even send a reminder by post or email

Official Old Man · May 8, 2013

It's normal. When taking any insurance always ask for continuation to be cancelled. I note they refunded you instantly so no problem there then.

Murray 17 · May 8, 2013

Gullster said:
Yep, Direct Line sent me a horrendous quote advising I need do nothing as they would auto renew. I contacted them and advised them I would be insuring elsewhere. After a bit of haggling they knocked nearly £100 of the price and ended up the best quote. I asked them how they could do that and they said that they could offer various discounts to keep existing customers. Why they don't do that to start with is anybody's guess. I accepted their quote and ensured auto renew was cancelled for next year. It pays to be on the ball and react as it seems they hope people can not be bothered and just accept their renewal letter.

It's known as 'continuous authority' and you need to cancel it or else they will keep renewing it automatically.
Insurance companies are well known for offering a low quote to entice you then bumping up the second year's premium. Over the last 2 years I have reduced my renewal premium by over £200, basically the cost of a whole year's insurance. Bell and Admiral are sister companies so always get a quote from the other and quote it if your renewal shoots up. They will always match it.

studio150 · May 8, 2013

As with all insurance it is necessary to read the policy document and also the Key Facts statement which would have been issued. I would expect that the policy contained words similar to :'Unless You contact Us, We will automatically apply for Your renewal premium from the payment details We have on file, shortly after Your renewal date. This is to make sure there is no interruption in Your Insurance cover.'

Of course the real reeason is not to ensure that there is no interruption in cover, but for the policy to be renewed, and to ensure that if you indeed to go elsewhere that you need to contact your existing insurer so that they have an opportunity to amend their terms in an attempt to keep you as a customer.

Personally I look at this as underhand tactics, and do not like giving ongoing manadates on debit or credit cards.

Tom Bombadil · May 8, 2013

Neil said:
12 months ago I insured my daughters car on the phone giving my Visa Debit Card details for payment of 12 months cover.
We went online a few weeks ago and and insured her car again with the most competitive quote, no problem with that.
Then this week the Insurance firm who my daughter was insured with last year takes another annual payment out from my Visa Debit card they used last year.
Question I am asking is ,surely this is illegal without contacting me 1st ??
In any case they never even contacted me to ask if their quote was OK (which it wasn't it was double the quote I got elsewhere).
They said because I hadn't contacted them they presumed I wanted to stay with them, no email, nothing .
Anyway I caused a stink and got a full refund as I proved that I was insured elsewhere.
Anyone else been caught out by this??

In order for them to take money out of your account you need to have agreed to continuous payment when you originally took out the policy. Further they need to contact you before the policy renews(there's a set minimum time think it might be 2 weeks) with details of your renewal policy and instructions on how to cancel.

drew · May 8, 2013

Neil said:
it was Bell Insurance and they didnt even send a reminder by post or email

Are you saying that they didn't send you any renewal documents, ie advice as to what the renewal premium will be, normally a cover note (ie if you pay just before renewal date a document that confirms you are insured until the new Certificate of Insurance is issued). You must have got something otherwise at prompted you to get alternative quotes?

Sounds to me that you got the documents, didn't like the renewal premium and didn't read the rest.

Garage_Doors · May 8, 2013

drew said:
Are you saying that they didn't send you any renewal documents, ie advice as to what the renewal premium will be, normally a cover note (ie if you pay just before renewal date a document that confirms you are insured until the new Certificate of Insurance is issued). You must have got something otherwise at prompted you to get alternative quotes?

Sounds to me that you got the documents, didn't like the renewal premium and didn't read the rest.

It's very normal for Internet insurance companies to not send out reminders, because it reminds you that it's due !
Had this direct from a traffic police officer after he pulled me right out side my house on one of my bikes.
He came into my place so I could show him the certificate , and when he checked it had expired the previous week !

Has he notice all the other cars on the drive and bikes in the garage he (helpfully) asked if any of the others covered me to ride it ,
I gave him all the relevant certificates for them but he could'nt be bothered to look at them all

but did say it not uncommon for Internet companies not to send out reminders, so accepted it was a genuine mistake.

CorgiRegisteredFriend · May 8, 2013

Worrying that a well known established company can store personal bank details for twelve months.

drew · May 8, 2013

Programme_Seller said:
It's very normal for Internet insurance companies to not send out reminders, because it reminds you that it's due !
Had this direct from a traffic police officer after he pulled me right out side my house on one of my bikes.
He came into my place so I could show him the certificate , and when he checked it had expired the previous week !

Has he notice all the other cars on the drive and bikes in the garage he (helpfully) asked if any of the others covered me to ride it ,
I gave him all the relevant certificates for them but he could'nt be bothered to look at them all but did say it not uncommon for Internet companies not to send out reminders, so accepted it was a genuine mistake.

On the contrary, it is far from normal for renewal notices not to be sent as that is likely to be in breach of FSA (now FCA) guide lines. Internet companies will automatically send out emails but chances are that people delete them as spam or, since inception of the policy, may have changed email addresses. Could also be that spam filters don't let the email through.

I doubt very much that a traffic officer would have a clue as to the administrative practices of the insurance industry except when they don't update the MID so a vehicle showing as uninsured is in fact covered.

Husty · May 8, 2013

CorgiRegisteredFriend said:
Worrying that a well known established company can store personal bank details for twelve months.

I'd like to know a 'well known established company' that doesn't tbh?

Kylies Stunt Arse · May 8, 2013

studio150 said:
As with all insurance it is necessary to read the policy document and also the Key Facts statement which would have been issued. I would expect that the policy contained words similar to :'Unless You contact Us, We will automatically apply for Your renewal premium from the payment details We have on file, shortly after Your renewal date. This is to make sure there is no interruption in Your Insurance cover.'

Of course the real reeason is not to ensure that there is no interruption in cover, but for the policy to be renewed, and to ensure that if you indeed to go elsewhere that you need to contact your existing insurer so that they have an opportunity to amend their terms in an attempt to keep you as a customer.

Personally I look at this as underhand tactics, and do not like giving ongoing manadates on debit or credit cards.

You also need to consider that since Continuous Insurance Enforcement came in a while ago you will show up instantly if you're driving without cover and you will get pulled over. If you're happy with the company and the renewal terms continuous payment takes all the hassle out of renewing the cover.

Also, when you take the policy out a question would have been asked about automatically renewing. This may not be in the policy booklet as it isn't a condition of the policy.

Garage_Doors · May 8, 2013

drew said:
On the contrary, it is far from normal for renewal notices not to be sent as that is likely to be in breach of FSA (now FCA) guide lines. Internet companies will automatically send out emails but chances are that people delete them as spam or, since inception of the policy, may have changed email addresses. Could also be that spam filters don't let the email through.

I doubt very much that a traffic officer would have a clue as to the administrative practices of the insurance industry except when they don't update the MID so a vehicle showing as uninsured is in fact covered.

I will bow to your better knowledge, I can only speak from actual experience, my insurer at the time Dial Direct whilst not automatically renewing advised they do not automatically send out renewal quotations hence why I did not realise insurance had lapsed,I know ignorance is not a defence in law but luckily the Traffic officer was far more knowledgable that you gave him credit for and as result did not report me accepting that it happens.

drew · May 8, 2013

Programme_Seller said:
I will bow to your better knowledge, I can only speak from actual experience, my insurer at the time Dial Direct whilst not automatically renewing advised they do not automatically send out renewal quotations hence why I did not realise insurance had lapsed,I know ignorance is not a defence in law but luckily the Traffic officer was far more knowledgable that you gave him credit for and as result did not report me accepting that it happens.

That's fair enough as that's your experience, however, the only thing I would say is that it is unusual for a company not to offer renewal terms or renew automatically. Logic says that once you've got a customer, you do your best to keep them. I don't know for sure but I would also find it very surprising if there aren't rules requiring a company that doesn't renew a policy that they have to notify the policyholder, not just motor but any form of insurance.

p.s I had the misfortune to work in the insurance industry for 26 years!

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