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Old 09.02.2012, 06:15
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Cancelling a long-term policy

I took out a boat insurance policy in 2005 with an agent for AXA Winterthur. I now want to sell the boat and as a preliminary in January of this year, informed the agency to cancel the policy when the current twelve month's coverage expires at the end of March (I normally receive each year's renewal notification and invoice each February). The agency informed me that they had passed my request to the AXA Winterthur head office.

Then the bomb-shell. A further lettter from the agency informs me that my cancellation cannot be accepted as my policy runs until 31 March 2015. This means, it seems, that I must continue to pay expensive, yearly premiums for another three years, even if I no longer own or use the object insured. The insurance cannot be transferrable to someone else who may buy the boat. A further absurdity is that the bottom has dropped out of the boat market and the insured value (and reflected premium) is double what currently would be realistic.

Examining the original policy from 2005 I note that the Vertragsdaur is indeed for ten years, something I completely missed when taking on the policy. Ignoring my stupidity in not recognising that, I am incredulous that such conditions can be applied, and, I assume, legally enforced. I would never have accepted such a committment had I been aware of it.

I wonder if anyone else has found themselves in a similar situation and if there is some sort of Ombudsman equivalent in Switzrland to appeal to.
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Old 09.02.2012, 08:43
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Re: Cancelling a long-term policy

The insurance companies seem to try to extend policy years when they send you the first contract. I have spotted it on a few now and ask them to change it. We had a 5 year one with our car. The insurer said it was canceled when we sell the car. Did you tell them that you were selling the boat or just when you wanted to cancel?
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Old 09.02.2012, 08:56
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Re: Cancelling a long-term policy

I think you will find Maria is right, if you sell the boat, the policy lapses, just like car insurance but check first.

Another get out maybe, would be to check the small print carefully, normaly if you make a claim, even a spurious claim (....) there is a possibility to cancel the policy 30 days after it has been accepted or more importantly in your case, declined.

It's not very nice, but then neither is screwing you with a 10 year policy.
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Old 09.02.2012, 09:33
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Re: Cancelling a long-term policy

Thanks for your responses, Marie and Today. The bind is, in this economic climate there is little chance of a quick sale and all that is likely is for the boat to sit for a year or two like all the others, in the dry storage area, out of the expensive mooring afloat. That way, it was planned that with less marina cost and no insurance (as I thought) I could save money. Fat chance!

Particularly annoying is that I now know that the premium was not influenced at all by the long-term policy and would have been little different for a normal 1-year one from a different insurer. Or maybe even the same one if I had insisted.
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Old 09.02.2012, 13:03
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Re: Cancelling a long-term policy

AXA were notorious for giving 10 year terms on policies back then and you would have no options if you wanted cover, unfortunately if you don't have a yearly termination clause with 3 months notice which is rare then you have little choice.

However, as correctly stated, if you sell the boat you are out. You could also investigate if the premium has increased for this next term... however, I would strongly advise even if you can get out leaving a boat uninsured is very risky and should be avoided.

Best,
David
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Old 09.02.2012, 13:32
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Re: Cancelling a long-term policy

Good news. This morning I have had a long phone call with the agency, who themselves were in contact with AXA's HQ in Lausanne.

They both came to an agreement to allow my policy termination by the 31 March 2012 as I had originally requested. In addition, the agency has offered me a limited and low cost, one-year coverage for the time I may be stored out of the water.

Call me a cynic but I am wondering if the founding of FINMA as a Swiss financial regulator (including insurance) in 2007 with one of their aims to blend in with EU regulations, may have played a part. I cannot believe that under EU consumer protection it is allowed to sneak ten-year policies onto unsuspecting punters.

But the moral remains - read and understand every word of a contract before accepting. I personally won't make the same mistake again.

Thanks to you all for your kind support.
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Old 09.02.2012, 14:53
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Re: Cancelling a long-term policy

That is good news!

The regulations did change, Insurance is a lot more open and the 10 year contracts are a thing of the past. 5 is now standard but clauses can be written in at request.
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