The Consumer Ombudsman has taken a stand on the refunding of insurance premiums. If a customer cancels an insurance policy before the agreed date, the insurance company must refund the unused part of paid premiums. Getting a refund should not cost the customer anything.
In a case that came to the attention of the Consumer Ombudsman, an insurance company told a customer who wanted to cancel a policy that he should inform the company of his bank account number within one week. Otherwise money would be refunded with a postal order, which could cause the customer extra costs.
The insurance company was reminded that on the basis of the Promissory Notes Act, the debtor is responsible for paying costs resulting from the payment of a debt. A payment practice resulting in extra costs for the customer could therefore be unfair to the consumer.
The insurance company promised in its response that the customer would not incur extra costs if the refund was paid with a postal order. The company also said that the reference to possible costs would be removed from the letter sent to customers.