RAC facing refund costs over breakdown cover renewal letters
The RAC may be made to offer refunds to as many as A million breakdown recovery customers after its policy renewal letters still did not prominently display the prior year’s premium.
Under transparency regulations introduced a year ago via the Financial Conduct Authority (FCA), companies have got to clearly show the total amount the consumer paid the previous year alongside the renewal price.
The rules were travelling to make it clear to consumers what amount the value had risen. The letters also have to encourage the policyholder to shop around for a lower price.
Breakdown recovery clients are often enticed to sign up for that has a heavily discounted price while in the 1st year, only the start to see the premium shoot up C sometimes double C while in the second.
Consumers often complain how the first they knew for the renewal was whenever they discovered that the latest, a lot higher, premium ended up automatically debited for their card.
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More than a single million RAC customers may not have had the proper information to consider if they should seek a much better deal elsewhere, and is offered their money back as well as to certainly cancel when they lost out therefore.
The RAC, that’s jointly owned by private equity firms CVC and GIC, said this company recognised that good info rolling around in its letters hasn’t been clear enough.
“While our breakdown policy renewal documentation did accurately contain most of the right information, we recognise that some of the key information in this letters has not been as prominently displayed the way it ought to have been,” he was quoted saying. The corporation will contact affected customers over coming months.
Admiral apologised in 2009 as soon as the FCA claimed it gave any mistakes for some customers who renewed policies.
