Esure cancelled policy after accident

[berglauf]

Hello,

 

E-sure cancelled my car insurance policy after a recent accident. I bumped into the back on the vehicle in front about 50m after setting off from traffic lights.

My vehicle was deemed a write off / total loss despite being valued considerably more than the repair cost and I was not given the chance to contest the decision. I later found out that it was a category D write off and told by the customer assistant that they'd likely sell my vehicle on. I asked for a copy of the damage report on my vehicle from E-sure and after the telephone assistant spoke to the supervisor I was denied this, despite E-sure having chosen the repairer who gave the estimate and the vehicle being legally mine.

I was told that the policy was being cancelled because the vehicle was "no longer in an insurable condition". I was also told that I WOULD NOT receive a refund on paid premiums. I'd paid for 12 months and had 3 when the accident occurred. The extra hire car cover I had taken on my policy was a joke.

Now that I have to acknowledge that I've had a cancelled policy my premiums have doubled. If I had been given the option to have the car repaired ( I had a discussion with the valuation engineer technician about this but was not given any say) I would have got my remaining 9 months worth of insurance that I'd paid for and my premiums would have increased but certainly not doubled.

To say that I feel aggrieved is an understatement. I've been subjected to having my vehicle declared a total loss against my wishes and also a refund that I think I should be entitled to denied. My premiums and history are now shot to bits. What is the point of insurance? My vehicle had no modifications in any shape or form. Bog standard first time accident at a slow speed.

 

Dangerously, the policy booklet is highly inadequate. Throughout my discussions on telephone I was consistently referred to the "total loss" (Section 5 element of the booklet). It spells out how the process works but nowhere mentions the fact that as a fully comprehensive driver you are no longer covered 3rd party to drive another vehicle. That little nugget is hidden in tiny small print on the bottom of the actual certificate of insurance. Surely this should be included in the Total Loss segment of the policy booklet?

 

I have just written to E-sure and will also be writing to the Ombudsman. The FSA regulations regarding insurance policy cancellations appear to have been broken by E-sure and I am keen to seek my refund and compensation.

 

Grateful for any advice.

 

Thanks,

[unclebulgaria67]

Definitely complain about the claims process, as that sounds like a total mess. They should have told you about the damage that made it a write off and then explained the process for agreeing to a market value. You can appeal if the market value is not to your satisfaction. Esure should have explained the process for complaining about the market value.

 

In regard to cancellation and any refund. Actually this is fairly normal amongst Insurers. Insurers have met their policy obligations. You took out an annual policy for car x and they paid out for a total loss. There was then no car to Insure. The Insurers would then cancel the policy and there would be no refund. If you make a claim, the whole years Insurance is payable.

 

If the cancellation is due to the write off claim and not any issue of you not declaring something or any accusation of wrongdoing, then this is not something you declare. When Insurers ask about having a policy cancelled, they are really meaning cancellation due to non disclosure or something which is about wrongful conduct. Your cancellation in this case, was just as a result of a total loss claim. That is all you need to advise Insurers, when you phone them.

[berglauf]

Hello,

Thank you for your reply. It has been helpful.

 

What then happens to my no claims? I asked E-sure for written clarification as, on the telephone, they advised that I would probably lose 2 years of my no claims bonus. The letter I received stated that "I was entitled to 5 years no claims bonus at the time of cancelling my policy". What do I tell a new insurer then?

 

The other thing that mystifies me is that FSA regulations state,

".....your insurer has the right to cancel a policy by giving seven days written notice. If this is the case they must refund any premium paid, minus the cost of insuring you while the policy was in force. For example, if you had paid the full annual premium of £500, but they decided to cancel your policy after just six months, you may entitled to £250 refund....."

 

Have E-sure not flown in the face of this? I don't understand how they are entitled to keep a full years premiums for a service that has only been made available for 3 months. If you held a yearly bus ticket and the bus service was withdrawn after 3 months, you'd expect a refund surely. Yes, I had an accident but that's why you have insurance.

 

Am I being unreasonable?

[unclebulgaria67]

In theory you lose 2 years NCB, but if they have said you have 5 years at the point of cancellation, you have to take their word for it. Perhaps you had 7 years and they reduced it down to 5 years.

 

In regard to the FSA wording above. It does state somewhere else, that if you have had a claim, that you are not entitled to any refund on the annual premium paid and that you have to pay for the full years Insurance. This has always been the case. You had an annual Insurance policy and not a 3 month policy. They cancelled it, as the Insurance contract had been fully complied with. You had a total loss and you cannot have any more compliance than that. If you think about it. It would not be very fair if you Insured a car for say £5k at a premium of say £500 and paid out the £5k, but the policyholder only wanted to pay for 3 months. They may allow people to pay monthly, but it is an annual contract. The bit you are not happy about, is that Esure cancel the policy and don't let you Insure another car for the remaining 9 months. Some Insurers do this and some don't.

[Wulfyn]

The terminology they have used is poor. They have not cancelled thepolicy, it has been fulfilled.

 

 

When you take out insurance on an item you are effectively buying the right for a 3rd party to indemnify you against the risk of loss. If you lose the item and claim on the contract and the 3rd party obliges then the contract has been complete. Because it is complete it will no longer cover you. This occurs when a car is deemed as a write off. However for a contract to be complete in full it must also be paid for in full. Otherwise it would be like you no longer paying for some things you bought on finance because the goods have been delivered.