I have a travel insurance policy which is renewed by the company every year. My credit card number was changed in January and my old card was cancelled and I received my new card in the post. I never provided the insurance company with my new credit card details.
After checking my online banking, the company had renewed my policy in February and charged my new credit card. I was baffled by this and wondered how could they charge me without having my new credit card details. It was not an issue as I needed the policy renewed anyway, but I was very curious to know how they got my new credit card details without me providing them.
I called the insurance company and my bank. The conclusions of my phone calls revealed that the insurance company are able to put the payment through as an offline payment. The bank then process this payment and charge the active credit card under your name.
I questioned the bank official and queried what action are they undertaking to prevent this. They indicated to me that there is nothing they can do unless you provide the bank written proof that you have requested to cancel your insurance policy with the relevant company in question.
The bank official also indicated that direct debits from your bank account are easier to cancel than reoccurring credit card payments. This is true as I have been able to cancel direct debit payments very easily by just popping into the bank.
It is just something to be aware of when providing your credit card details in the future to companies for these types of payments.
