direct debit cancellation question

[scottishlass]

the story so far

next door neighbour (21) bought new car sorted out insurance online realised he could get it much cheaper so cancelled insurance and direct debit with bank.

they are charging him £121.44 which I have told him will probably be right (have not seen the agreement) as they are allowed to charge a cancellation fee think he was only insured for a couple of days.

The question is he received a letter from insurance company asking for payment if not paid within 10 days

quote
the amount above will be due to be debited from the last debit/credit card used

can they do this as he has not authorised it ?

as there was insufficient funds in his account when they tried to take the payment he has been charged £35.00 and a further £28.00

any help on this would be appreciated

SL xxx

[Glenn UK]

Re: direct debit cancellation question

Do the distance selling regs apply to on line transactions for insurance?

if they do i think the buyer has 7 business days to cancel the contract and I'm sure its without penalty.

Secondly if the amount of charge for cancellation is payable, then it should be in line with the terms and conditions. £121 sounds high given the time period involved.

re the credit/charge card. Sadly the way the banks work is that if you give out your cc/dc number then the recipient of that number can use and re-use it and you cannot easily (if at all) cancel the use.

There may be other more authoritative views but this is what i am given to believe.

if the payments were disputed in writing prior to a payment being taken then it may be that there is a case for a claim against the insurance company.

JMHO

Glenn

[Glenn UK]

Re: direct debit cancellation question

Newarly forgot if you do wish to cancle the ability of a creditor to charge direct to a cc or dc card then i thnk the only practical way is to say the card has been lost or stolen,. The issuer once informed will immediately cancle the card prevenitng further use.

HTH

Glenn

[scottishlass]

Re: direct debit cancellation question

thanks for that info Glenn will speak to him later today.

SL xx