I've been charged a £100 insurance cancellation fee - is this fair?

I recently attempted to change my insurance policy as I had a change of vehicle and the premium went up by £440. When I questioned how this could be, I was given the explanation of increased risk, breakdown, reliability, etc. This didn't seem right, so I did a price comparison on various sites and with several other companies it was only a few pounds more expensive. When I informed my current provider that I was leaving, they slapped me with a £94.70 cancellation fee. Can this be right? They weren't anywhere close in competing with the other quotes. Is there anything I can do?

Asked on 16 October 2018 by Nicola Maguire

Answered by Tim Kelly
Under the 2015 insurance act, any cancellation fee should be "reasonable", i.e, no more than £30 to £40. Raise a complaint with the insurer, then raise a complaint to the Financial Ombudsman service. When complaints get taken to the Ombudsman, should the complaint be found in your favour, the FOS charge the insurer £500 for reviewing. If more people complaint about insurer's sharp practices it may make them think twice about doing it.
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