Making sure you make your monthly car insurance payments

Making sure you make your monthly car insurance payments

A matter has been brought to us by a broker whose daughter purchased motor insurance on a month by month basis.

It appears she did not use her dad but purchased it through what appears to be an authorised representative of the insurer. I could stand corrected on this as it is only early days.

Anyway, on the day the monthly payment was meant to go through there was insufficient funds. The Insured knew that the money was due and there is proof it went into the account on the correct day and before she received word that the attempt by the Insurer had failed.

She thought nothing off it as she has topped up the bank balance with enough to cover the insurance.

Days later she received a missed call from the AR who did not advise that the insurance was not paid but simply asked her to return her call.

Phone records show she rang back and she too got a voice mail.

Murphy’s Law is alive and well. She was involved in a car accident and her dash cam shows she was not at fault but she now finds herself with no insurance and the third party confirmed to us that they too are not insured.

The question is can we sort this out. We will try our best.

The reason for this post is all about sharing the lesson learned. If you are on a monthly payment plan for any insurance product please, please make sure you have the funds in the account before it is due each month or like this client you may find yourself in a serious financial position for the sake of in her case a few minutes.

No car, no insurance, and yet with a loan on the car to repay. Not a pleasant position to be in.

2 responses to “Making sure you make your monthly car insurance payments”

  1. David Powell says:

    Must be more to the story for you to be involved, Firstly it would be a 12 month policy the person has in place that they are paying monthly. The Insurer would of had to issue a notice of cancellation and then can only cancel 3 days after the notice is issued.
    When notice of cancellation takes effect
    The notice of cancellation will not cancel the
    contract immediately but takes effect at the earlier
    of the following times specified in section 59(2):
    the time when the insured enters into another
    contract of insurance intended by the insured to
    replace the contract; or
    whichever is the latest of the following times:
    ? 4 pm on the 3rd business day after the date
    on which the notice was given to the
    insured, except for a statutory policy in force
    under section 58 in which case it is the 14th
    business day)
    ? the time, if any, specified in the contract, or
    ? the time, if any, specified in the notice.

  2. JR says:

    Wow, that is really interesting. I am no car insurance guru but would the period of insurance dates be. Assuming 12 months, but I then must assume pretty harsh cancellation clause due to non payment of monthly premium. Not fair if this the case.

    Thanks for sharing.


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