Date:9 July 2007 I Comments: 12 I Views:36,928

Because this blog post has gained ranking in Google for searches relating to the 14 day cooling of and cancellation period I have added the following: 

For facts regarding 14 day cooling off periods, refer to the FSA handbook:

Items marked with a capital ‘R’ are rules.

If you need further advice the FSA can be contacted by phone: 0845 606 1234

It makes sense to fully read and understand the terms and conditions of your contract before committing to anything.

What I have learned: The 14 Day Cooling off period for insurance is pointless because insurance companies are allowed to charge a ‘reasonable’ fee  for admin charges even if you cancel within the statutory 14 day period.

You can dispute any fees if you think they are excessive and unlawful. Your insurer should have a complaints procedure for you to follow or if in doubt, contact the FSA.

Creditmarket – Motorbike Insurance, Secured Loans and Free Credit Reports.

And now the blog post! Please feel free to read on… 

No cancellation fee to pay and nothing to pay for the 48hrs car insurance cover I theoretically had.

Today I tried calling NU again. This time to determine what was meant by ‘the date of purchase of the contract’ because according to their terms:

‘You have a statutory right under Financial Services Authority rules to cancel your policy within 14 after the later of the date of purchase of the contract or the day of which you receive your policy documentation.’

I didn’t need to determine the day I received the documentation because that was pretty obvious.

Anyway, I spoke to Raman in their call centre in India who told me that NU no longer offer a 14 day cooling off period for any insurance contracts, including renewals.

Naturally I was shocked because the FSA told me that a 14 day cooling of period was statutory!

I felt compelled to tell the FSA what I had been told so I gave them a ring.

What I learned from the FSA this time was that although a 14 day cooling off period was statutory, insurers have a right to charge a reasonable admin fee even if you cancel your policy in this 14 day period.

This is allowed because it puts people off of buying a policy then canceling after the documents come through so they have a certificate to wave around if the get pulled over. It also deters people from buying a policy just to drive for a few days then canceling when they should just ask for short term cover!

What this means is NU were perfectly entitled to charge an admin fee despite my policy being cancelled within the 14 day cooling off period.

But they haven’t, they’ve waived all fees and I don’t owe them a penny!

This is because I was told initially that, due to no payment having yet been taken, the new policy had not officially come into effect and I could still cancel without charge.

Even though this had been dismissed in subsequent calls to NU it was something I had been told by one of their advisers so they had to honour it.

Remember, when you call anyone to talk about queries, complaints, your rights or for official information, ALWAYS ask for the advisers name. Try to make notes about what you have been told and record the time.

Most large financial organisations record conversations so they will be able to refer back to their own notes and confirm what you have been told.

Category: Insurance


  1. What I’ve concluded from this is the ‘Statutory 14 Day Cooling Off Period’, even though mentioned in car insurance documentation, is pointless! If insurers can charge a fee if you cancel during this time, what’s the point?

  2. Joe Ajayi

    ****SWINTON**** I have been with Swinton since 20th mar 2009, I was told I can cancel within 14 days if I wasnt happy with my cover. I called them on the 25th mar 2009 to cancel, and was told that after taking a deposit of £66.18, I would owe them £26.81, in total, its cost me £92.99 for 4 days. I argued this with them,but to no good. I asked for the copy of the conversation, they said its another dept who deals with that. Imagine calling premium numbers and being on the phone for 1hr. I cancelled all the same, am speaking with the FSA now and would pursue this. I am happy to be with Churchill now.

  3. Dean Whiting

    ****SWINTON, AGAIN**** I too have just been charged a £50 cancellation fee by Swinton. Despite cancelling the policy within the statutory 14 day cooling off period. Despite arguing my case they would not adjust there position. For a copy of the conversation a fee of £10 would be charged. I think i will also be talking to the FSA. anyone else having drama’s with Swinton?

  4. Deb Davies

    *** More Swinton ***

    Have just cancelled after 6 days with Swinton. I would have done it earlier but they are closed on
    Saturday afternoons and Sundays!!! They are charging me £55 to cancel. A reasonable amount to cover
    admin fees would be around £15 plus a charge for the few days the policy was running not £50 as stated in
    the paperwork. Is it because they loose the commission from the actual insurer
    (in my case Fortis),so pass that loss on to you? I will be ring the FOS in the morning.

  5. Vicky Hampton

    I cancelled with Swinton in March 2009,after 1 months insurance they said they’d call me back with the amount it would cost me…no phone call. I received a letter from them on Saturday 27th June when I was at work and could not call them about it til today, Monday 29th (yes they are closed on Saturday afternoons and Sundays) stating that they would be charging me £79.85 for the 1 months insurance and if I don’t pay they’ll pass my details onto a Debt Collection Agent. The whole insurance only cost me £169 before they put the interest on, the whole thing is a con. I will be contacting the FSA but don’t hold out much hope as from Jan 2008 the ‘Excessive Charges to Customers’ section in the Insurance code of Business Sourceebook has been removed.

  6. richard

    well my girlfriend phoned up swinton organised insurance to start saturday coming
    , told me how much the premium was so i got her cheaper car insurance.
    She cancelled the next day (4 days before the policy starts) and they are going to charge her 75 pounds for cancellation. Still £125 pounds better off.

  7. Tim

    *** Swinton Yet Again! ***
    Just cancelled a policy with Swinton today. For 7 days cover is has cost £80! That’s £50 cancellation fee plus £30 for various fees. I don’t count £50 as a reasonable admin fee. What is the point in a 14 day cooling off period that has virtually no effect whatsoever?? Found another policy that has saved me £200 even after the cancellation fee! Still going to follow it up with the FSA though.

  8. CI Besre

    I got stung for £50 and for only 5 days into the ‘cooling off period” for home insurance with them… Called the general branch and was put through to a very arrogant “Line Manageress”…. Summary of the conversation… It’s like that and that’s the way it is…

    Next time I will concentrate more when the lady “RECITES” the terms and conditions!!!

    Expensive lesson!!!

  9. damian chambers

    hi there,i have just been through same thing,i got a quote from POST OFFICE insurance £420 for a year £95 premium and £42 a month there after.i brought this in january but policy didnt start til feb 15th,i had to change my car on the 22nd as mine was dying so phoned up to inform them and they quoted me £1056 for new car,as this was a massive increase i told them to cancel insurance and they charged me £124.16.i had only been insured for 14 days coolin off period was over befor my policy had even started (that’ll teach me for being prepared)they wasn’t even interested in reducing the new quote to keep my business. so in total they got £219.16 for 7 days insurance. then to top it off they said they were takin the £124 from bank in march but instead they took it on the 25th feb. stay clear from post office.will be contactin FSA tomorrow as i feel conned

  10. graham big g

    i was with the post office insured a mitsi rvr,the ins company asked for a copy of my V5 Logbook which i didnt have it had gone to Dvla,this was on the 15th April 2010,they gave me 14 days to provide said Logbook,phoned on numerous occasions as on the 29th April they were cancelling my insurance in full.Well the 29th came no LogBook No Insurance,so i changed companys,the next thing you know a mth and half later demand from post office for £220 cancellation fees,i phoned told them it was them who cancelled not me so why do i have to pay.They said doesnt matter who cancelled i would have to pay.
    It Stinks does the post office no help at all STAY WELL CLEAR OF THEM.

  11. Geoff Rogers

    Swintons threatened me with a debt collector – threatened to take money from a cancelled direct debit. Varied the Direct Debit 4 times in 4 months with no notice. Tried to charge me a cancellation fee of £50.00 + another £24.18 for something else. Wrote to them with a list of their misdemenours and said that I would report them to the Financial Ombudsman unless they cancelled the threatened debt collector. They said they would take the money using the bank account from the cancelled direct debit. Phoned the Financial Ombudsman. 5 days later received compliment slip from Swintons cancelling all charges I owe nothing!

    Swintons are very unprofessional so don’t deal with them