Bank making error, not deducting payment from account

F

Fauve

Registered User
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Hi
Bear with me..
We pay insurance (Life assurance tied in with mortgage) together with mortgage repayment each month.
Last year we negotiated a new policy, which reduced our payment by approx E10 pm. The bank did not adjust direct debits even though old policy cancelled and new one in place. I wrote a letter to them explaining this and next month no payment was taken. I assumed that this was a "refund" of sorts, one month off which would be equal what we overpaid by for two months.
Next month, no payment taken with mtg repayment.
Following month No payment taken again.
I have contacted the Insurance provider a number of times and as far as they are concerned the policy is still in place and they are getting paid.
Contacted mortgage provider (same as bank ) and as far as they are concerned the policy is still in place.
I have also contacted the Bank to tell them all of the above and they are telling me that the mortgage amount INCLUDES the insurance premium.
According to mtg provider the mtg repayment amount does NOT include the insurance but (as I knew myself) is the mrtgage repayment minus trs only.
The guy at bank tells me he is sure that the amount is correct. I tell him it is not.
My plan is to write a letter but it is all getting silly and confusing....
I want to pay as I know in due course when they see the light I will get a nice little bill when I don't need it.
Hubby reckons someone else is paying it..(bank error).
Such a silly little problem, but am annoyed at the amount of times/phone calls (with two impatient little kids at Mommy on the phone again).
What is the best way to proceed??? Letter or say nothing until they figure out their error and pay in due course.
Thanks in advance for even listening.
 
Letter is good, then at least there's a record of your attempt to be compliant should the bank discover there's an error.
 
Hi Fauve
This may appear a silly little error right now, but might not appear so if ,God forbid, the insurance was claimed upon. I don't think that the insurance company would be interested in you making a back payment in that event, do you?
This absolutely needs to be clarified in writing, where all three of the bank,insurance provider and mortgage provider confirm that your policy is in place, and by whom it is being paid..(ie should be you, whatever way it is being done..)
By the by, unless you are getting what people are 'saying' to you confirmed in writing, you can't rely on it,as it would turn out to be your word against theirs.
Best to be persistent with this, as potentially serious consequences if the insurance isn't in order
Good luck!

Nicola
 
Hi NicolaM
Many thanks for your reply and you are correct, I know I have this niggly feeling about this all the time.
I have paperwork to clarify that the policy is in place, the NEW one from the Insurance company and the Mortgage company.
Is this sufficient or should I contact them for more up to date letters of clarification.
I still have to sort out who is paying this...
It seems to me the only issue is with the person in bank who seems a bit disorganised and has paperwork all over the place and says he will get back to me buy never does.
Very very frustrating.
Thanks again.
 
Hi
Why don't you sent your disorganised bank contact a letter,as you seem to be getting nowhere with him by talking. Ask for clarification about all this, explain your grave concerns about not being sure that the insurance cover is being paid for,and CC it to whoever is his direct manager (if you ring the branch, they should be able to tell you: even better, ask HIM who his direct manager is, before you write, and explain why you are doing so), This should prompt a response.
Keep copies of any letters that you do send.
The insurance company need to confirm who is paying the premium, again in writing. Explain your concerns in the event of the insurance being called upon.If they confirm that it is being deducted from your account, well and good, rest easy. But it doesn't look like this is the case.
By the by, those letters that you do have, do they pre-date the non-payment of the policy from your account? Think about a different scenario: You enter into a contract to purchase car insurance by direct debit. You then receive a car insurance cert, and put it in your car window, in the happy knowledge that you are insured. However the money wasn't being taken from your account for some reason. In the case of an accident I think the insurance company would argue the toss that it was your responsibility to ensure that the money was being paid out from your account, and that since you were not paying, you were not covered.
How frustrating, and what a waste of time for you, however!

Nicola
 
NicolaM said:
Hi

How frustrating, and what a waste of time for you, however!

Nicola
Click to expand...

Yes yes yes, just spent half the morning trying to get to the bottom of this.
Ok, we are halfway there, letters on the way to confirm policy in place, explained my concerns re what is happening.
It appears that the premium is being deducted from someone else's account.
Did a letter last night for bank explaining the whole thing, only found out about the incorrect account when I telephoned Insurance co to clarify if policy in existence and request confirmation of same in writing.
I am so annoyed (and so fed up with this thing), we have just started switching proceedings a few weeks ago too so after all this hoohaw, we'll be moving away from this bank anyway.
Thanking you again NicolaM, yes I totally see your point re car insurance etc, and agree. Needed to get it on paper to see the trees in the wood, if you know what I mean.
Fauve
 
It's a bit scary, isn't it, if you think about the insurance not being valid? At least you noticed though!
If they are deducting it from someone else's account, then it should be relatively easy to get them to rectify it for you (and explain to the other person why they've been deducting money from their account....)
I'd also be inclined to write a (brief, considered, calm*) letter to complain too, as this is a potentially serious error, and you've had to spend considerable time and effort trying to resolve it,
Nicola
*If you fire one off when you're feeling furious and irritated,as you might well be now, it might look a bit over the top/hysterical, a pre-putting-in-the-post read through is always good! (speaking from personal experience..)
 
Hi again, airing more thoughts..
Well it appears that the payment was being taken from someone else's account..I rang the bank to ask them to check, they did, rang me back to say I was right and that is all I heard (until today, just over a week later).

So today I get a phone call from Insurance co to say "it has come to light" that this has been happening and they now have to take a lump sum from my account.... as they can't repay the other customer until I have paid(!) and obviously my insurance premium is in arrears.
So there I am thinking well I was the person who shed the flipping light on it, that was after months of phoning..and now due to someone else's error I have to locate a lump sum in a month that is partcularly tight for us (holiday soon and trying to accumulate spending money).
I have a bad taste in my mouth from all this and I feel totally powerless.
Not a word from the bank (whom I assume made the error in the first place), and nothing in writing from anyone. (apology or otherwise).

Have no qualms about paying this (but would prefer to do it next month), and I really would like an apology I think.
Can they just take the payment without authorisation?
I will be writing a letter (x3) about this but so fed up with it all!
Fauve
 
Hi Fauve
I think they can probably deduct the money if it's a direct debit, as there is usually a 'variable direct debit mandate' that you sign for: i.e. you've probably already given permission for them to take differing amounts of money from your account.
However, when they say 'they have to take a lump sum from your account' that sounds as if they are asking for permission.
1)If this is the case, I'd be inclined to decline permission, on the basis that if you had to claim during the time involved, they might not have paid out.
2)If they have already deducted the money, via your direct debit, which they are probably legally entitled to do, I would then look for compensation (i.e. to get the money paid back into my account, as it isn't your responsibility that they in error deducted the money from someone else's account. )

Claiming retrospectively for insurance?

I personally would argue the point with them: saying that I would be more than happy to pay for cover from now on, but that I most certainly would not be happy to pay backwards for it, due to my point above (i.e. not being covered if you had a claim, potentially).
I think this depends how far you'd like to take this: it does take time sorting this sort of thing out, but you certainly deserve a letter of explanation, and personally, I would expect to be reimbursed, if this money is deducted.
It is possibly better to go to the top of the chain: write a letter to the manager of your branch, or ask to speak to them. You are more likely to have a satisfactory resolution doing this, and this has always been my experience.
You may well be successful in this. It just depends really how much time you are willing to invest, and as I have said above, it'll probably take time.
Post back to say how you get on
Nicola
 
I was the other side of the fence on this one. We took out a new mortgage and after 4 months realised that 2 payments were going out each month. One was the mortgage and the other was for €110. We assumed at first that it was an adjustment for an extra few days or something but after month 2 rang then and only got an answer 2 months later.
I called the bank and got the reference number for the payment and called the company who told me it was for our €90k top up mortgage. Advised we didn't have one and was told by insistent staff member that we did. Eventually got her to check the details and "oops...not yours". So we had been paying someones mortgage. We were refunded that day.
I would have thought that what happened was VERY rare, a once off, but apparantly not......
 
Hi again
I just wanted to report that this matter is now resolved and the error ammended and all parties settled and happy!
It turns out that it was not a banking error but a clerical error by insurance co a few months ago.
An apology and token for any inconvenience was received with thanks and the issue is now over (i hope).
We are paying backlog which we are happy to do, and tbh I can't be bothered arguing the case.
Thanks to all for information and advice.
Interesting to hear your story ailbhe. The only way is to check all debits from accounts, all the time it would seem.
Thanks again to all.
Fauve
 
Last edited:
Obviously I spoke too soon.
I rang the Insurance co a few days ago with a general query, only to discover that they had cancelled our policy!
So for quite a few days we had no policy at all and it would have go on and on if I hadn't phoned on the offchance with unrelated query.
Was told that if anything had happened we would have been covered as it was their mistake!!
I have requested a letter to clarify that this situation has been rectified and the policy is back in place, which I expected to receive within two days (is this too impatient of me?). Not a word yet.
And they are going to take payment for months not paid next month.
Bad taste in mouth after all this.
Anything I should do? I feel like we should walk away and take business elsewhere but have just negotiated a new policy for when the switch happens (waiting for switch to complete before activating it), if I do anything else in the meantime would it only make everything very messy?
Frustrating!
 
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