Wednesday, 6 August 2014

If you have RAC or Budget insurance – you may be overpaying

It has been discovered that hundreds of policyholders who are currently customers of RAC and Budget insurance – or have been customers in the past – may have been paying around £50 per year for unwanted products because they didn't un-tick a box which offered a free trial for personal accident cover.

Those policyholders affected bought insurance products between April 2009 to the end of May 2013. When they signed up to the product, they were given the opportunity to have free personal accident insurance for six months, but after that they were automatically charged £3.99 every month, often unknowingly.

The companies were using a pre-ticked box on the policy application form and have since announced that they stopped using it at the end of May 2013. There are still however  a large number of customers who are still paying the money every month and just don’t realize – even if they aren't currently customers of RAC or Budget.

The EU banned the use of pre-ticked boxes for most online product in June 2014 and the Financial Conduct Authority is set to ban them for insurance products by the end of this year.

Am I affected?

If you hold – or held – an insurance policy with either Budget or RAC between April 2009 and 31 May 2013 you could be affected unless you can remember that you un-ticked the free trial box. If you didn't and you haven’t cancelled the cover, there’s every possibility that you’re paying for personal accident cover you don’t want.

The way to find out if you have been paying is to have a look at your bank statements and check for any debits in the name of Avon Insurance as this is the company who was the original underwriter.

I have been paying for cover I don’t want – what do I do?

You need to cancel the cover immediately. Telephone Avon on 01789 415 050 and tell them you don’t want the cover. You may need to have your policy to hand to give the details of it so they can match the query with the policy. Their details should also be included with your RAC or Budget policy documents.

As this has been unwittingly costing customers around £50 each year, you could have been experiencing a shortfall in your monthly budget so to get back on track over the next few weeks, firstly make the call to Avon and then look to take out a small payday loan at http://www.payday-choice.com/payday-loans-online.

Can I claim back money I've already paid?

If – like many current and previous customers you didn't realize you’d been opted in to something you didn't want, request a refund from RAC on 0800 015 6000 or Budget on 0844 412 2118 and tell them you’re unhappy with the situation and that you want your money returned.

If they don’t agree on the strength of a telephone call, write to them and include the bank statement which shows the first ever payment which was taken. If you don’t have the statement, your bank can help with this.

If there is still resistance to a refund, you can then take it as an official complaint to the Financial Ombudsman service. This is free and is the organisation which settles disputes between financial companies and individuals. Don’t contact the Ombudsman until you've first spoken to RAC or Budget and have given them 8 weeks to reply as these are the official guidelines which must be followed.

Many however aren't having to go this far; reports are that money is being successfully refunded as soon as a complaint is made so if you find you've been subjected to these unwanted payments each month – act now.

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