PETERHEAD, Scotland, December 9 /PRNewswire/ --     After receiving several reports from angry customers about their
insurer's cancellation charges, (some in excess of GBP140),
http://www.noclaimsdiscount.co.uk researched some of the major insurers to
find out what these charges were based on and why consumers were seemingly
unaware of them prior to purchasing the policy -- in particular, the
"administration fee" for cancelling your policy. The charges themselves
proved concerning, though not as much the lack of clarity.

Elephant.co.uk has a cancellation administration fee of GBP47.50 - but
this was only found out after some considerable digging.

The same was true of Liverpool Victoria who had to be badgered a little
on their Live Help service before admitting to a GBP35.00 cancellation admin
fee.

Saga will only charge you if the administration cost incurred exceeds
GBP5.00, although they don't offer an upper ceiling limit.

The AA charge GBP25.00 but the terminology used in the booklet was far
from clear, and it took a phone call to have it explained properly.

There were many other insurers who would have to be directly contacted to
find out the charge -- such as the RAC, Sheila's Wheels, Sainsbury's,
Churchill, Esure, Co-op and Privilege who all used the following type of
terminology to advise of an impending charge whilst refraining from
disclosing the actual sum:

"Less an administration fee to take account of our costs in providing
your policy. The fees are detailed in your Schedule" -- indicating that
people are only notified of the "cancellation tax" after the policy is taken
out.

Such is not always the case:

MORE TH>N, for example, have no problems advising you that it will charge
a hefty GBP55.00 should you wish to cancel mid-term.

Zurich levy a GBP50.00 charge if you cancel during the first year.

Barclays Insurance seem more reasonable with GBP26.50.

Swiftcover.com rank as one of the lowest with a GBP25.00 admin fee for
cancellations. Not only was this lower than most, but all their charges were
laid out in a clear and concise manner with viewable policy documents
containing a complete breakdown of the percentage premium refund to be
expected over the year.

Further, out of the several insurers NCD News questioned about the
justification for these fees, Swiftcover.com were the only ones to officially
respond. Craig Staniland, Underwriting Director for Swiftcover.com, told NCD
News: "Swiftcover.com does charge GBP25 to customers who cancel their
policies during the first 14 days. There are two reasons for this nominal
fee: to cover our administration costs and to also reduce the number of
people who enter into a motor insurance contract and cancel at the first
opportunity once they receive their Certificate of Insurance."

It is always worth writing to the insurance companies to ask for a
breakdown of the fee prior to purchasing the policy. Any quote you receive
from them will generally be valid for up to 30 days. If you have already been
hit with such fees, write to your insurer asking for justification -- if the
fee is proved to be unjust or they offer "just because" as a reason, you
should be entitled to a refund, if they refuse then threaten to take the
matter further.

http://www.noclaimsdiscount.co.uk/news/ editor, Michael Beverley, said:
"If insurers want to charge large amounts in cancellation fees then not only
should they be completely clear to the consumer before purchase, but some
justification should be given as to why their charge is more than double that
of another insurer. Maybe if a wave of resistance can get going, insurers
might start re-evaluating their 'admin fees' before they become as big a
target as bank charges and PPI mis-selling."

About NoClaimsDiscount.co.uk: NCD News covers insurance related news
aimed at both the industry and consumers, providing a balanced look at
developments that could affect it's readership. You can find more information
on the insurers covered in this article at
http://www.noclaimsdiscount.co.uk/insurance/

Original article:
http://www.noclaimsdiscount.co.uk/news/art_display.php?show=200812061

Contact: Michael Beverley
    e: press@noclaimsdiscount.co.uk
    w: http://www.noclaimsdiscount.co.uk
    t: +44-792-051-1695