How to get a refund on your car insurance due to coronavirus
MOTORISTS across the country might be eligible for a refund off their annual car insurance costs because of the coronavirus outbreak.
The current lockdown means most drivers are paying for their cars while not actually using them but it may be possible to claim some of these costs back.
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Since March 23 the UK has been on lockdown after Boris Johnson ordered all non-essential shops to shut and told people to stay at home unless going out to buy food or medical supplies, for exercise, or for work.
In fact drivers have been warned they could invalidate their insurance if they make unnecessary journeys.
But even though most drivers can't use their cars, they will still be paying for car insurance along with other costs including tax.
Here we explain how you could get a refund on your policy costs.
What insurers are giving refunds?
While there has been a six-month break from MOTs, nothing has yet been announced around insurance costs.
In the US some insurers have started offering discounts of 15 per cent for policyholders.
There hasn’t been an equivalent announced in the UK but some insurers have said they may give refunds.
Direct Line, for example, which has more than five million customers and includes the brands Green Flag, Privilege and all the Nationwide insurance products, said it would consider refunds in some circumstances.
A spokesperson said: “If a customer believes that their mileage will be a lot lower than originally estimated at the start of their policy, they can contact us and we can process a refund.
“As long as you’re reducing mileage by at least 1000 miles annually, and you’re not already on a particularly low estimated annual mileage, a refund will generally be available."
The insurer explained it has always been possible for customers to change their mileage mid-way through a policy but this is usually because of a permanent change in circumstances whereas at the moment it is likely to be a temporary one.
“Customers who have changed their estimated mileage for the year due to COVID-19 will not need to get back in touch with us to reverse the temporary change.
"To keep things simple for our customers we’ll automatically revert to their normal mileage from their next renewal date," the spokesperson added.
But this isn't the case with all insurers therefore it depends who you bought your insurance from.
We asked Aviva, for example, what the case was for policyholders.
A spokesperson said: "Premiums are calculated to cover expected costs over the 12 months of a customer’s policy.
"If a customer has a concern or is struggling to pay their monthly payment, then they should contact us by email or by telephone to discuss their circumstances."
How do you ask for a refund on your policy?
Although no blanket changes have been made, it may still be worth contacting your insurer to ask the question if you feel your annual mileage will be far lower than estimated.
There is sometimes an admin fee for changing policy half-way through so it's worth checking if one would apply if you do reduce your mileage.
A spokesperson for the Association of British insurers said: “Your motor insurer can advise on any options that may help reduce your premium, or if you are worried about being able to continue to pay premium instalments.
"Any premium adjustments or refunds will be a matter for individual insurers.”
However, there are no guarantees you will get a refund. Car insurers don’t have to pay them as you have entered in a contract for a year to pay for the policy.
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Can you declare your car off road?
It is possible to apply for a Statutory Off Road Notification (SORN) if you are no longer using your car on public roads.
If approved this means you no longer need to buy insurance for your car, but it also means you won't be able to use it.
This includes for essential trips such as going to buy food or medicines and it would no longer be covered for damage or theft.
What can you do if you can’t afford your insurance?
If you are struggling to pay your insurance, whether that’s monthly or annually, contact your provider and let them know. They should be able to offer some help which could mean lowering your payments.
Can I just not pay my insurance if I'm not driving?
Unfortunately not. It's a legal requirement to have car insurance for your car if you are using public roads, and when you buy the policy you are doing so with the assumption you'll use it for a year.
A spokesperson for the ABI explains: “The law requires that all vehicles on the road must be insured, and even during lockdown, many private motorists will need to use their vehicles for essential travel, and need to be fully insured.
"Even if you do not drive during lockdown, you will still need to be protected against theft, vandalism and damage."
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Interest and payments on car finance deals can be frozen.
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