As a business insurance broker, we do have a detailed knowledge of all aspects of cover. We try to help anyone that phones us up, even when the chances of getting some business out of the call are very slim. We were open yesterday on the Bank Holiday and I received an interesting call from someone just looking for some advice.
This customer, Miss A, had just started a new venture and had received a salon insurance quote from a recommended broker. As everything was a bit of a mad rush to hit her start date, she hadn’t really had a chance to look around for any alternatives. After the initial start date had passed and the business had opened without a hitch, she was sitting down to review some of her paper work.
The reason being that she had just received the invoice for her insurance and one of her members of staff who was going to send the cheque, commented that it seemed a bit high compared to her last job. So, Miss A had asked us just for an idea of the costs. She gave me brief details and, based on what she had told me I knew that we would have at least three different insurers who would quote around the £400 mark, possibly less if we referred it back to the insurers.
Her quote, believe it or not, was £795.00, which was way over the top. She had proceeded with the cover, but I explained to her that, under the EU distance selling directive, she had 14 days to cancel the policy, at no charge whatsoever. She said that her brokers were closed on the Bank Holiday, but she would give them a call today as her 14 days are up on the 1st June.
If they play ball, then they should cancel the insurance cover, ab initio, or in plain English, from inception. But and it is a big but, you have to be careful because you are not getting 14 days cover for nothing. What you are getting is no days cover for nothing. Potentially you could be faced with a liability claim in months to come and, because you had no cover, you could be faced with a large bill.
The best thing the customer can do, is to try and get the current provider to reduce the premium, on the basis that the market price is a lot less than £795. Our recommendation was not for her to cancel the policy, she may just have to bite the bullet and accepted that she was over quoted for the first year and put it down to experience.
If you get a chance, always look around for an alternative.