Almost a year ago, I paid for a year's worth of insurance for our 250cc scooter with Progressive thru an independent ins. agent in Little Rock, AR. That policy cost $129.00.
This week, I changed to State Farm, who assured me I could change policies before my previous one with another company expired, and that the former company would simply cut me a check for the credit balance.
Guess what? Not so!
Of what I paid to the ins. agent, only about $75.00 went to Progressive.
Because page after page at Progressive.com tells me to contact my independent agent with regard to canceling a policy, I made several attempts to get someone on the phone at the agency...for three days. I never got a live person. So, I emailed the agent AND Progressive and asked that my policy be canceled.
This was 09-22-09. My policy w/Progressive was due to expire on 10-15-09. Now I have a bill for $30.00 from Progressive, which is called a "cancellation fee"! This charge is almost 50% of what my ANNUAL policy cost with this company!
I phoned the number on the bill, and was told that this charge WAS disclosed to me at the time I signed the paperwork, but let me tell you, this is not something my agent ever verbally disclosed. Furthermore, apparently it appears on the application, not the contract I was supplied with, so I wasn't provided with a written copy. The Progressive representative said that if I'd allowed my policy to simply lapse, I wouldn't have been charged the $30.00 cancellation fee, and they said they wish I had contacted them first! Can you believe it?
Well, I asked the rep to get a hard copy of the application to me asap, since I believe I should have been provided with copies of ANYTHING I signed from the get-go. I also told her that I did contact them by email, and that would have been the perfect time for them to say anything they wanted to about fees I'd incur for canceling the policy.
They also tried to pass the buck to the state, saying at first that this was a "state fee".
There was decidedly more paperwork involved in setting this policy up than there is in canceling it, but I wasn't charged an "administrative" fee for that...which is what they were calling this fee just before the phone conversation ended.
I asked them to send a detailed breakdown of what this "administrative fee" goes to...to justify the need, basically.
My State Farm agent was aghast at Progressive charging me a fee to cancel my policy with them, and a former Progressive employee that I know told me this is a relatively new sneaky practice by Progressive.
The rep said that if I do not pay the fee, it will be turned over to a collection agency. I am turning it over to my state insurance commission, my state senators, Michael Moore, every blog I can find, my state newspaper, AND everyone I come face-to-face with in my life at work, college, and at play. DO NOT CANCEL YOUR PROGRESSIVE VEHICLE POLICY, friends, just let it LAPSE. PROGRESSIVE INSURANCE CO. are thieves!