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Title: Insurance auto renewal

Date: 29 September 2014

Q

With regard to Insurance Companies practice of "automatically" renewing Policy's. When my Motorcycle Policy was automatically renewed in May. I must admit I paid little attention to it, as I assumed the cover would be identical, to that which I had enjoyed the previous year.

To my dismay when my motorcycle was stolen from my driveway in August, I noted that not only the Company I was insured with had changed, but additional exclusions applied, whereas before, theft was covered, if my motorcycle was at my home address, but not garaged, at double the excess, the new Policy excluded any cover for theft, if the machine was not garaged.

My question is, do I have any redress against my Broker/Insurer or is it my own fault, for not thoroughly checking the new Policy, when it arrived.

M Newman

A.

Automatic renewals are common place within the insurance industry however it is a policy which frustrates many motorists, particularly when they take the opportunity to substantially increase the premium. In your case it would seem that this has been further complicated by the fact that it is a broker who appears to have renewed the policy on your behalf rather than your renewing with the insurer directly.

As you say that you paid little notice to the paperwork, the first thing you need to do is to obtain copies of both the policy documentation and any correspondence which was sent to you by the broker so that you can identify exactly what you were told at the time of the renewal and by whom because failing to read something you were sent is no defence.

That said, there are two things of note here. One is that the broker is under a duty to ensure that the insurance policy that they obtain for you is suitable, and two, the insurance company is under a duty to ensure that the policy that has been sold to you is fair, and that any exclusions which nullify large parts of the policy are suitably highlighted to you.

On that basis, once you have obtained all of the documentation, if the broker didn’t explain the difference then you should complain to broker first and then the Financial Services Ombudsman if you don’t get satisfaction. If the broker did explain then you should check the insurance paperwork. This would seem to have been a major exclusion and as such it would need to be set out very specifically in the insurance policy documentation rather than being buried in the small print. If it was not suitably highlighted then you should complain in writing firstly to the insurer directly and then again to the Financial Services Ombudsman.

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