New data shows around 1.3 million car insurance policies are cancelled each year in the UK. Insurers charge around £55 each for an early cancellation fee meaning firms could be receiving up to £71.5million in early exit fees.
“They’re locked into annual car insurance contracts because there aren’t viable alternatives and are then penalised if their circumstances change and they end a policy early.”
Cuvva has urged road users to ask an insurer to list all the additional costs associated with a policy before they sign up.
It warns a policy may look like a good deal but added fees can add up to be a lot more expensive than first imagined.
It urged road users to consider more flexible car insurance policies which do not charge fixed cancellation fees.
It said: “If you pay for your insurance monthly, then you might not get a refund.
“In fact, you may have to pay extra to cover the time you’ve been insured, as well as a cancellation fee and any administration charges.”
It added: “You can try to dispute the cancellation costs, but you may not be successful.
“A better option is to make sure you know exactly what the cancellation fees are before you take out the policy, so you aren’t hit with any surprises.
“If you think the charges are excessive and you can explain why you think they’re unfair, you should talk to your insurance provider directly.”
Source: | This article originally belongs to Express.co.uk
The post Car insurance firms pocket over £71million through early exit cancellation fees appeared first on 247 News Around The World.