Automatic Insurance Renewal - Cannot afford to pay

8 posts in this topic

My husband works as a freelance illustrator / artist and last year for the first time in his career had a client request Public Indemnity and Liability insurance. 

They covered the expense of this so via a broker agreed a policy with Hiscox running 18.09.18 - 17.09.19

We were, perhaps naively, under the impression that this policy was only for a year, as we had explained to the broker that it was a single project and not something he ever normally needs.

Fast forward 10.5 months and we've just received a letter in the post congratulating him on his decision to renew and asking for information on changes to his business.

Since this project in late 2018, my husband has unfortunately not had any commissions and has made zero money from his illustration, so is now looking for a full-time job.

With that in mind we now have even more so no use for the coverage AND we cannot afford to pay 825€ for it.

 

I've scoured the AGBs and cant see any information about a Kündigungsfrist and have emailed Hiscox and our broker to explain the situation, but am terrified we will be forced to pay this amount.

 

Questions:

Can we still cancel? What are our options if his business is making no turnover, but we haven't changed anything at the Finanzamt yet?

 

We don't have a SEPA-Lastschrift setup - what happens if we simply refuse to pay the new invoice? Will his coverage be automatically cancelled or are we going to be sued by Hiscox / face even more fines / even worse, be blacklisted for bad credit?

 

Any help anyone can give would be incredible - I'm devastated and paying this invoice will be a huge financial hit on an already terrible year...

 

Thanks so much! 

 

 

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What does the contract say in the terms and conditions , that you signed? 

Most subscriptions here do auto renew, so 3/12 cancellation is usually required. 

Have you spoken to the broker ?

 

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2 hours ago, rld said:

Questions:

Can we still cancel?

 

Nobody here can say that, we don't know the terms of the contract. You have to wait for the insurance and broker's answers, sorry.

 

2 hours ago, rld said:

What are our options if his business is making no turnover, but we haven't changed anything at the Finanzamt yet?

 

The tax office has nothing to do with it, if you can't quit anymore, you have no other option but to pay to avoid legal difficulties and even higher costs. 

 

2 hours ago, rld said:

 

We don't have a SEPA-Lastschrift setup - what happens if we simply refuse to pay the new invoice?

 

Then the insurance company will legally collect the debt. This will be much more expensive for you. 

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8 hours ago, RedMidge said:

What does the contract say in the terms and conditions , that you signed? 

Most subscriptions here do auto renew, so 3/12 cancellation is usually required. 

Have you spoken to the broker ?

 

 

I scoured the contract and the only reference to cancellation was with regards to Teilkündigung and it asked for a months notice, which we still have a few weeks for. But I couldn’t find any reference to cancellation in full or to renewal. 

 

I’ve read in various german forums that if the renewal policy was not clear enough you can refuse payment and argue, but I’m not sure how tough this process would be and don’t want to get stuck in a costly legal argument. 

 

We’ve not been able to get through to the broker yet, will chase him up on Monday if we’ve still not heard. 

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So what is the Teilkündigung?  Can you decrease coverage and cut your bill with a months notice?  If you can it would be a good idea.

 

Germany is famous for it's automatically renewing contracts.  It's really the rule rather than the exception that if you don't cancel with proper notice, they auto renew for another year.  By the time you get the letter telling you it's auto renewed, it's too late to cancel.  You should find this in the small print somewhere.

 

In your situation, I would write a letter to cancel it now to the first possible date and send it by fax if you have that option as well as registered mail.  That will prevent you forgetting and having it auto renew again next year.  If a Teilkündigung is possible, I would also include in the letter that if you are too late to cancel the full policy for this year, you want to do a Teilkündigung as of the first possible date.  Sure you can talk to your broker but don't trust your broker to cancel it for you.  I knew someone who was trying to cancel insurance and actually would have had enough time but the broker strung him along until it auto renewed and he couldn't get out for another year.

 

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20 hours ago, LeonG said:

I knew someone who was trying to cancel insurance and actually would have had enough time but the broker strung him along until it auto renewed and he couldn't get out for another year.

Maybe that would be grounds for demanding damage compensation from the broker?

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2 hours ago, jeba said:

Maybe that would be grounds for demanding damage compensation from the broker?

 

It's an old man and I doubt he has rechtschutz.  He didn't take it to court or anything.  

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It was meant as a hint for the OP as it might have been his insurance broker´s mistake.

On 8/2/2019, 11:02:37, rld said:

we had explained to the broker that it was a single project and not something he ever normally needs.

 

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