Date:8 July 2007 I Comments: 4 I Views:8,500

Because this blog post has gained ranking in Google for searches relating to the 14 day cooling off 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.



Online Car Insurance Comparison, Mortgages and Loans – 



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


This is a continuation of a previous post regarding 14 day cooling off periods and cancellation fees.

Following the cancellation I have since received 2 letters from NU both claiming I owe different amounts!

One for the amount of £24.07 which it turns out was a complete admin error and should never have been sent because the figures don’t correspond to any of their fees or charges.

The second for £57.82 which is their £52.50 late cancellation fee and £5.32 for the two days of cover I had before canceling.

So before watching the British Grand Prix I thought I’d call them and see what it was all about.

When I spoke with NU on Friday I was told that if no payment had yet been made towards the new policy, the new contract would not yet be in place and I would be able to cancel without charge. Apparently this isn’t true and I shouldn’t have been told it.

So, misinformation and letters sent with imaginary fee amounts…..from NU. Inspires confidence doesn’t it!

I tried to explain that the FSA had told me they thought NU were bending the rules a bit but the operator thought I was just making up excuses! In actual fact, he just didn’t have any idea what I was talking about because, despite working in the cancellation department, he hadn’t been trained on the FSA rules.

The long and short of this mornings phone call is I now have to write to the Customer Services Manager detailing the reasons why I don’t think I should pay the cancellation fee.

I think I’ll do that after the Grand Prix!

An afterthought regarding fees is that with bank fees, they are deemed unlawful because they are excessive compared to what the fee relates to.

I therefore also think this cancellation fee is unlawful because the same amount of admin would be required to cancel the policy if it was cancelled in time and there is no charge for that!

So to charge a fee just to do the same thing a day or two later, I think, is totally unreasonable and unlawful!

I will blog about the response to my letter…!

Category: Insurance


  1. James Clarke

    I have a similar problem with insurance charges. Churchills Insurance want to charge me £101 for cancellation due to my car being uneconomical repair and not roadworthy. I am now being chased and threatened with court by their debt collectors. Any advice would be most appreciated. please e mail:

  2. Fairy

    Thanks for the providing good information – this is really helpful for car accident insurance.I found another good one that helped me find an incredible rate they give you the best rates from lots of local providers Car Accident Insurance

  3. nat

    my insurance company canceeled my policy after 1 month as they said they couldnt cover me? they had already had £320 by 2 direct debits, i asked for a refund but they said they were keeping the money for the 1 month cover that i had already had, (Full year was just over £1400) and they wanted another £89. i asked why so much and they said cancelation fees?? but they cancelled not me the broker also asked for £14.00 cancelation fee aswell. i intend to call my bank on monday to get them to recall the DD’s if poss and i will also complain to Aviva in writing as my broker says they dont have a number for them that takes calls from customers , what a joke!!! i wouldnt mind paying 1 12th of the total premium but not 30%. any advice would be most welcome.

  4. Thanks a lot blogger for such a nice and informative post about car insurance in UK .For any parent one of the best ways of keeping motor insurance premiums down is to keep their kids off the policy. Whilst there are specialist motor insurance brokers who can get you the best premiums on the market.IIn order to get cheaper insurance, you need to know who to ask, often there are too many options and some of the contributory factors are beyond your control such as having a high risk job such as in entertainment or as a mini-cab driver. Other factors such as having an imported car can push up your insurance. This is why you need to use an independent broker with a telephone support line to guide your through the minefields.t is still going to be an expensive business getting cheap car insurance with a young driver on the policy.