This time last year I was in Thailand at the start of a 3 month trip. Before going over I secured a year long worldwide travel insurance policy with American Express. I had used a cheaper UK insurance company the previous year but having actually having made a claim and being told that I wasn’t eligible for anything I made the decision to spend a bit more and opt for a ‘good company’.
I was checking my online credit card statement today and I noticed a fee of £128.97 from them. Obviously alarm bells were ringing in my head already because of this because I know how these companies work. People always go on about watching out for small companies and online sites ripping you off but I can assure, the larger brand name companies are just as sneaky, if not more so.
So they had basically had renewed my policy without my consent. I called up today and they told me that they do this for all policies and that this was clearly stated in their documentation before signing up. I don’t recall this ever being stated anywhere when I signed up. I certainly wouldn’t have agreed to this if it had been clearly stated anywhere; so they obviously hid this renewal policy in their incredibly long policy document, which would take a good 2 hours to read.
I complained about this and said that they had no right to do this. The guy on the phone gave me the ‘sales talk’ about how they did it to protect customers incase they were away travelling. Complete bullshit; they know that they will make money from people not cancelling their policy. If I had been away for a month and came back to a letter saying they tool £130 off my credit card without my consent I would be very pissed off; particularly because they renew it with a 30 day cancellation policy i.e. if I didn’t notice this coming off my account and called in a months time I would be fucked.
Here’s the annoying thing. I called up last year and said that I only needed 3 months of cover and asked if they could give me a quote and the woman told me to go online and check their annual cover as it works out much cheaper in the long run, particularly if you go away on another holiday. So instead of 3 months they somehow managed to take 2 years off me. Bastards!
And here’s another annoying thing. I had to send cash from my current account to my credit card right away to avoid getting interest on it as they said it will take 5 working days to give me back my money and it happened a week ago so there was a good chance I had to pay interest on it.
I still lose out
When (if!) they do refund my money, it will simply give me a positive amount on my credit card. I cannot transfer this to my current account. So either way, they have fucked me over by this.
I don’t live in a dream world. I know they use these tactics as many people will forget to cancel their policy and if they try after 30 days they can say “Sorry but we can’t help you”. The media have been highly critical of companies selling products via trials and then signing them up to automatic renewals (teeth whitening etc), yet they don’t seem to have a problem with huge companies like American Express using the same tactics.
There is nothing I can do. In todays society all you can do when something like this happens is bend over and let them give it to you. It won’t hurt them, but I will personally never use them ever again; not for insurance or credit cards or anything, and I will make a point of telling others about their dodgy tactics too.
I wonder where, from a legal point of view, we all stand if we did the same to them. What would the courts say if I sent them a letter saying that I was going to walk into their office in one months time and take £100 out of their cash register unless they sent me a ‘cancellation letter’. Would I get into trouble for this? Probably so.
Perhaps you are not allowed to fuck people over individually. What if I create a company and tell my staff to send letters to 100 American Express offices telling them that we will take £100 from their cash register unless they reply. Maybe that would be legal in the eyes of the law.
The fact is, we have no power. If American Express had told me that I couldn’t get a refund then there would be little I could do. I use my credit card a lot for protection against companies going bust etc; but I very much doubt Master Card would have followed up a claim against American Express for taking money out of my account. I called Visa up a few years ago because Scan Computers had send me a broken motherboard and wouldn’t refund the money and Visa said that they couldn’t even open up a claim.
Unfortunately, I doubt this will be the last time something like this happens. Many companies, small and large, are happy to rip off their customers using sneaky tactics like this if it makes them more money collectively. However, the more they fuck people over, the more people will go elsewhere.
Or so you would think. Unfortunately, many people have short memories and these companies have large advertising budgets to bring in more customers every week. When they lose one customer, they can use the extra revenue they brought in from ripping them off to find a new one.
Also, think about this whole thing collectively. They took about £130 from me. Let’s assume they did this with 10,000 people in the UK as well. That’s 1.3 million pounds sitting in their accounts at least for a few weeks. Which will earn them a good amount of interest. And that’s only counting the UK. Worldwide they probably earn interest on hundreds of millions of pounds using this method every year.
Just be aware of automatic renewal when you signing up for anything online, particularly things which are priced monthly or yearly. If you don’t, you might find yourself in a fight to get your own money back :)