GG writes: I have recently moved to London from Switzerland, but kept my car insurance with my original Swiss insurers. I live in a gated compound, but late last year the gates broke, and I woke up one morning to find my car had had all four wheels removed. My Swiss insurers, who had been told the car was parked in a secure place, have refused to pay the claim, stating that I should pursue this with the company that insured the building on behalf of the property managers — which was Norwich Union. It, too, has denied liability. What do I do?
This is a very unfortunate case. Norwich Union insures the property, and the policy includes cover for public liability, but the firm is adamant it is not liable under this section, on several grounds: first, the compound displays clear signs that cars are parked at owners’ risk; second, the gates were not designed or intended to prevent anyone getting in, but principally to deter outsiders from parking there; and third, as soon as the faulty gates were reported repairs were set in train, although it took time for parts to arrive and repairs to be made.
I suggested you contact the Swiss insurance ombudsman bureau on help@insuranceombudsman.ch. There is also an English language website — type Swiss insurance ombudsman into Google.
You later reported to me you had contacted the bureau but its reaction was negative; it believed that because you had told your Swiss insurer the property was secure, it would not be liable. I am disappointed by this and had hoped for more flexibility on its part, but I’m afraid you have now run out of options. Perhaps the lesson is not to do insurers’ job for them by assuring them your car is kept securely, as you are then taking on the risk.
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Lost payment is a needle in a haystack
SH writes: On February 25, 2004, I made a payment of £100 in cash at the Cannon Street branch of Lloyds TSB to my Abbey credit card. When I received my next statement from Abbey the amount had not been credited and I was charged £25. I explained what had happened and Abbey refunded the charge. It told me to ask Lloyds to run a full bank trace — but my missing money has never turned up.
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You did not obtain a receipt for this, and trying to locate the missing money was, says Lloyds TSB, like looking for a needle in a haystack.
At one stage it seemed it had been found, as another customer with a similar name had deposited £100 at the same branch on the same day, also in payment of an Abbey credit card bill. But this, it appears, was simply coincidence. You have made dozens of phone calls over the past 15 months, to no avail.
Without a receipt, it’s “my word against yours”, which is always difficult to resolve. Fortunately, Lloyds TSB has taken a grown-up, generous view of the matter. As you are a good customer and would be unlikely to have spent so much time and effort chasing £100 over more than a year, it is going to refund you the money — and is adding £25 as a goodwill gesture.
Meanwhile, for anyone paying bills in cash over a branch counter, the message is: make sure you get and keep a receipt until payment has been confirmed.
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Why won’t Halifax let us surrender?
ST writes: Since the start of last year we have been attempting to surrender my London Life endowment policy, which was linked to our mortgage with Halifax — we are switching to a repayment loan and wish to use the proceeds to pay down the loan. The problem is that we have been unable to get Halifax to issue a letter to the life company saying it has no interest in the policy. When we started this process, my husband and I both took out extra life insurance to replace that provided by the endowment. This means we have been paying extra premiums for life assurance cover that we won’t actually need until we get this policy surrendered.
Your policy was originally with AMP, then Pearl, and latterly London Life — all, at the time, members of the same group. But Halifax did not appear to twig this, which probably accounted for the delay. It has now arranged with London Life for you to receive the surrender value of the policy as at the start of last year, together with interest on that sum and a full refund of premiums paid on the endowment, plus interest, since that time.
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You also had problems obtaining a refund of premiums on your house insurance policy with Halifax which you stopped at the beginning of this year, switching to another provider — but Halifax had continued to take monthly premiums. You were told that a refund cheque would be sent by post but it never turned up. It seems someone at the Halifax decided it would be quicker and more helpful if the refund, £135.30, were credited direct to your mortgage account, which is what it did, only it failed to tell you. It is now sending you a mortgage statement to confirm this.
All in all, Halifax has not covered itself in glory over this one, and is sending you a hamper as an apology.
No stopping my Isa direct debit
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DM writes: I took out a regular savings stocks and shares maxi-Isa with Hargeaves Lansdown in the last tax year, paying contributions by direct debit. I am annoyed that, because the direct debits continued into the current tax year, I am stuck with taking out an Isa with that company for this year as well. I accept that the firm is legally correct in that its terms and conditions state the direct debit will continue unless I take steps to stop it, but this was not drawn to my attention and it smacks of sharp practice. It is too late for me, but perhaps I can warn others.
I see your point, and it is certainly worth warning others of this general point, but Hargreaves Lansdown has not behaved as badly as you think. It sent you a letter in early February which specifically pointed out that if you did not take any action, your contributions would continue for the next tax year and you would not be able to invest in any other Isa that year. You are pretty sure you never received this. In any case, the company has had another look at the letter and is going to change the wording to make it more clear. It will also look to see if it can make the wording clearer on its application form.
The complicated Isa rules are to blame here. They say that if you contribute to a maxi Isa in any tax year, you cannot take out any other Isa with a different provider in the same tax year — even if you do not breach the overall annual limit of £7,000. Alternatively, you may take out up to three mini Isas with three different providers: a cash Isa of up to £3,000, a life assurance Isa of £1,000 and a stocks and shares Isa of up to £4,000, within the overall £7,000 limit. But you have to opt for the mini-Isa route at the outset — you cannot convert a maxi to a mini halfway through the year.
Revenue & Customs rules do allow regular savings Isas to be undone when they have inadvertently gone into the next tax year, but only if the investor had made it clear to the Isa manager that he wished the investment to stop at the end of the tax year, and the manager had wrongly continued taking money under a direct-debit arrangement.
Using student loans for a house deposit
JW writes: Our daughter will graduate in 2006. She has taken a student loan each year, and placed them in Isas. When she leaves, she will have about £12,000 saved which she would like to use to fund a deposit for a house. The interest rate charged on student loans is currently so low that this is a cheap way to borrow money. But are there any downsides?
The interest rate on these loans is 2.6%, but is due to rise to 3.2% in three months. I cannot see any downside to keeping the loans going to fund a house purchase: mortgage rates have, for the past 20 years or so, been higher than the inflation rate, so she will be winning.
Bear in mind that if house prices fall, however, your daughter could fall into negative equity, because her deposit is, in effect, money borrowed on the student loan scheme.
E-mail Diana Wright at questionofmoney@sunday-times.co.uk or write to A Question of Money, The Sunday Times, 1 Pennington Street, London E98 1ST, giving a daytime telephone number. We cannot send personal replies or deal with every letter. Please do not send original documents or SAEs. Advice is offered without legal responsibility