Strange letter from (UK) Volvo Owners Insurance

I've insured my Volvos with Volvo Owners Insurance (administered by Royal
and Sun Alliance) for a number of years - but am going elsewhere this year
because they have hyped up the premium and imposed an excess on glass damage
for the first time in living memory.

They issued the renewal invitation one month before the renewal date (which
is 25th October), as usual - but I have ignored it because of going
elsewhere. This morning I received a letter from them saying:

<Quote>
Dear Mr X,

We refer to our letter of 24 September asking for payment of £XXX in respect
of the above policy. To date, we have no record of payment received.

Please pay this amount by one of the following methods {cheque, credit card,
on-line} by 18th October 2007.

If we do not receive your payment by 18 October 2007, we will be obliged to
take further action. This may include cancellation of cover or cancellation
of your entire policy. Where the policy is already cancelled, the debt may
be placed in the hands of an agency to pursue collection.
</Quote>


How dare they! *What* debt? My policy is fully paid up until renewal date,
and I have made no commitment whatsoever to renew with them. I owe them
*nothing*!

Have they taken leave of their senses - or are *all* motor insurance
companies doing this sort of thing these days?
--
Cheers,
Roger
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You need to go into insurance office and showing this letter. If your
are paid up to date-bring proof. They can not change coverage in the
middle. Yes, they can change it at the time of renewal but not
before.

Good luck

 

It may well be that you have unwittingly entered into an arrangement
whereby renewal is automatic unless you tell them otherwise. Mine
with Direct Line works like that, and the renewal invitation letter
reminds me that if I want to renew, I need do nothing (except tell
them about any details which have changed) and that the premium will
be collected by DD a few days after renewal.

So you *could have* made a commitment to renew (whilst of course
reserving the right to change your mind, in which case you ought to
have let them know). If that is the case, and if they do renew, and
subsequently cancel the renewed policy, they could indeed hold you
liable for the uncancelled portion of the renewal premium.

 

Yup - a lot have changed their T&C's to say something like "your
policy will automatically renew at the end of the year unless you tell
us otherwise". Did yours?

 

In an earlier contribution to this discussion,

Absolutely not! The renewal invitation letter (referred to in this latest
threatening letter) says:
<Quote>
How to renew your cover

{things about payment options}

Please ensure that we receive your premium payment prior to your renewal
date, otherwise your cover will cease automatically.
</Quote>

I can live with that - but *not* with "Pay by one week before renewal date,
or we'll take legal action" - which is the gist of the latest letter!

In the past, I have always paid - one year at a time - by giving them my
credit card details over the phone, and have never used a DD or given them
any other sort of continuous payment authority.
--
Cheers,
Roger
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Fair enough. It was probably a "computer error", then.

 

Ceasing to cover you is not the same thing as you not having a
contract to pay them. It's quite likely that the default action on
your part (not cancelling, not paying) will leave you in a position of
owing them for a policy that no longer exists, as an enforceable
contract.

Why do you think otherwise? Why do you think they might have _your_
interests at heart?

 

Principles aside, send them a formal letter of cancellation before the
25th and never look back.

blurp

 

Do not rely on that belief; make sure you cancel prior to, and with effect
on, the expiration date of the current year policy unless you believe
litigation is entertainment, when you should stick to your fine
principles. The insurer is required to insure you unless and until you or
they terminate the cover, and they will not terminate the policy prior to
its expiration by which time you will already be liable for some further
payment. So it's your choice - play the silly bugger or give them a phone
call.

Tony

 

I suspect it's a not-so-subtle way of applying pressure on you to renew
instead of shopping around. You could probably get a lower premium off
your current insurer if you start a new policy with them - a disloyalty
bonus, in other words.

Matti (writing from uk.finance)

 

I recently took out a year's policy over the phone. I was told verbally that
they would renew automatically and was asked if this was okay, to which I
replied 'no'.

When the paperwork came through I noticed that they had nevertheless
included the statement "We reserve the right [to renew automatically, and
you will be liable for payment, but you can opt out at any time]".

For a start, "We reserve the right..." is an interesting choice of language.
To reserve a right, surely they have to be in possession of that right to
start with. I don't think they are in such possession.

In any case, it occurred to me to consider what the position would be if
they hadn't already asked the question over the phone (or, equivalently, if
they refused to acknowledge that they had done so, if and when it became an
issue).

The way I see it is this: If I bought a book over the phone, or over the
Internet, and when it arrived it came with a letter saying that they had
reserved the right to sell me further books, but that I could take the
trouble to 'opt out' of that system if I wanted, I don't think they would
have a leg to stand on if I ignored it. It's unsolicited goods. And if they
charged my CC, I'd like to think that the CC Co would agree.

Why should it be any different buying a year's insurance cover?

So, I haven't bothered to do anything about it.

(Follow-ups set)

 

So, genuine questions:

Is this requirement an insurance-specific thing?

Is it a recently-introduced requirement?

What regulations is the insurer bound by regarding the setting of the new
premium, to ensure fair play?

 

In an earlier contribution to this discussion,

Yes, in fact I had already phoned them - to tear them off a strip for the
letter and to cancel the policy from the renewal date - before I posted my
original message.

They were not all that apologetic - so I assume that's now their standard
procedure. They seem to have undergone an upheaval (office move /
cost-cutting exercise) of some sort recently anyway, and don't seem anything
like as clued up as they used to be. They've got a new computer, which holds
more information about their customers than the old one. In their first
attempt at a renewal notice they made up the missing information - with the
result that I apparently passed my driving test when was 7, and my wife
passed hers when she was 4!
--
Cheers,
Roger
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The InsCo is regulated by the FSA.

The FSAs overiding principle is that all those authorised by them should
'treat customers fairly'.

You post certainly appears to me to be an example of you *not* being
treated fairly.

On the basis of the info you have posted it seems to me that your
insurers are out of order. Contact them and tell them what you think
(but in a reasonable way) but if you sense that the conversation is not
going your way be sure to introduce the words 'treating customers
fairly'.

 

In that case you might need to cancel your credit card - On the basis that
anyone who deals this way is certainly not below drawing your premium from
your credit card - And credit card companies are obliged to pay them

Reminds me of a nasty experience I one had - I was buying my telephone
service through 'World Online' to get free internet service - Every single
bill I recieved (paid directly from my Visa credit card) was overcharged -
after 6 months of over billing I final told them to sort the whole mess
out - give me a final bill and we were finished - Planning to make my final
payment by cheque (so they could over charge me) I called Visa and told them
not to pay World Online any more money

Visa: "We have to"
Me: "What?"
Visa: "If someone makes a demand on a credit card we have to pay"
Me: "Yes but it's my money and I'm telling you not to pay them - Can't you
just put a note on my account?"
Visa: "But it's not your money"
Me: "Yeah - but you'll be asking me to pay it back"
Visa: "True"
Me: "Well I'm asking you not to pay them because they are a bunch of crooks"
Visa: "They won't stay in business very long if that's true"
Me: "They won't be - and mean time you want to give them my money - What if
they asked you for £5000?"
Visa: "Then we have to pay"
Me: "Don't be ridiculous - I've just told you they're crooks and you are not
to give them any more of my money"
Visa: "But we have to"
Me: "Well you can give them all you like but it won't be 'my' money"
Visa: "But it's on your account"
Me: "It won't be because I'm cutting up my card as we speak & cancelling my
card right now"

 

No way. There is either a contract or there is not. That means that
either they will provide cover and you will owe them for it, or they
won't and you won't. You owing them for cover they don't provide is
not an option.

 

No they aren't (except for CCA's). If you dispute the transaction the
credit card company will ask for proof from the retailer that the
transaction was authorised, and if the retailer can't provide that
proof then the credit card company must refund you. They may put the
amount "in dispute" for a few months, so it'll still be on your
statements but they won't charge interest.

However, if you've given anyone a CCA (continuous charge authority),
they can pretty much charge what they like when they like, as you've
pre-authorised them to! And unlike DD's you can't stop them with the
bank.

Which would almost cetainly have been a CCA. Hence your problems....

 

They were authorised to draw monies from my Visa card

but that was before i realised they were crooks - I acted on this new
information by closing my account (any business) with them - and you would
expect Visa to respond similarly to the new information - but i don't think
i was talking to a real Visa telesales person - i think it was just a goat
with a headset on

Hence the whole debarcle - and the O.P. may have unwittingly done similar

 

In an earlier contribution to this discussion,

Absolutely not! In any case, that theory doesn't fit the facts. If they
believed I had given them a CCA, they'd just have debited my CC, not
threatened me for not paying.
--
Cheers,
Roger
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Email address maintained for newsgroup use only, and not regularly
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Indeed, but if you then breach that (by not paying), they no longer need
to honour it. If the contract that you _did_ agree to last year
included these terms (and some of them now do) you can find yourself
bound to a contract and owing for it, but with it already cancelled as
far as the cover goes.