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Find out more'My attempt to get cheaper car insurance has backfired'
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I shop around every year to see if my car insurance deal is competitive before renewing. While waiting for my insurer’s renewal quote, I found a tempting quote elsewhere.
It was only valid for 24 hours so I went ahead and bought it, thinking I could cancel it in the 14-day cooling-off period if it proved higher than my existing insurer’s quote.
However, it now appears the new insurer is not only more expensive, but it’s also intending to charge me a fee for cancelling the new policy. Is this allowed?
Haimon from Wrexham
'Fees can apply even during the cooling-off period'
Simon Dicey, Which? Money expert, says…
Unfortunately, yes – some insurers charge a fee of up to £50 even if you decide to cancel within the 14-day cooling-off period after buying.
In your case, the £20 cancellation fee was buried in the small print, meaning you weren’t aware of it, despite checking the insurer’s website for information about cancellation charges.
There could be more fees, such as to set up or renew a policy or make midterm adjustments. These fees push up the overall cost of insuring a car and are often hidden deep in the terms and conditions.
Fees are often hidden deep in the terms and conditions
After making a formal complaint, the insurer eventually refunded you the £20 and awarded you a £75 payment as a gesture of goodwill.
Part of what landed you in this situation was your existing insurer not sending a renewal notice.
Typically, your existing insurer should send next year’s paperwork through to you between 21 and 30 days before your policy renews to give you enough time to decide whether to go ahead.
You can expect to get the best quotes between 20 to 26 days in advance of renewal – leaving it too close to the deadline often leads to higher pricing.
- Find out more: the insurers with the highest and lowest fees
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