YOURLifeChoices member Graham received a costly reminder of just how important it is to read the small print. How many of you also cast aside your insurance renewals without reading the details?
Has anyone else noticed the increasing tendency of insurance companies and utility providers to automatically deduct the next year’s premium/payment? An assumption is often made that customers don’t want to shop around for better deals and, having retained the credit card number from the last transaction, they deduct next year’s premium without specific authority.
This happened to me when I received a renewal from my insurance provider which was simply too expensive. I shopped around and made the switch to a less expensive provider. However, I made one costly mistake – I didn’t advise my initial provider that I was making the switch. Only when I received the following year’s renewal notice from my old provider did I realise it had deducted the premium and I had essentially paid twice for insurance.
Despite being able to prove that another company had insured me and that I had not made a claim, the provider refused to refund my premium. It claimed that it was legally entitled to retain the premium and I should have read the small print on my renewal notice.
Many people, especially those who may be older, are unaware of the deduction until it’s too late. If they have decided to go with another insurer or supplier, they’re likely to find on the next credit card statement that a double deduction has been made, one for the ‘old’ insurer and one for the insurer they’ve now chosen. Insurers try to justify this by claiming that the deduction is made for customers’ convenience, which is just rubbish and runs contrary to the general practice of people to look for better deals. I would have thought that any contract – say between a person and an insurance company – is for a specified period. It is not enduring.
Have you been caught out by a similar practice? Do you think the onus is on the individual to advise the company that the agreement will not be rolled over?