Virgin Mobile ate my insurance

August 11, 2009 2:58 AM

I've just been seriously burned by Virgin Mobile - who've reneged on insurance - just wondering what strategies I can use given the situation.

I recently transferred to Virgin Mobile from Vodafone (not willingly, Vodafone didn't have coverage to where I was moving). I transferred my number, Treo750 and also my handset insurance (or so I thought).

You see, Virgin's insurer (Risk Insure) only accept insurance for phones that have been purchased through Virgin Mobile, and are no older than a few days old (fair enough).

Trouble is, Virgin Mobile didn't tell me this (I did the transfer over the phone), and accepted the insurance knowing that I'd brought my own phone.

They never sent the PDS (insurance policy), but continued to charge me each month. I assumed I was insured.

I got hit by a wave walking with the kids and of course the phone is now cactus. I called Virgin and they realised they'd made an error and tried to simply cancel my insurance and refund the past 4 months of payments. I argued the point and they then put me through to Risk Insure, who then gave me the run around for 3 weeks before telling me they wouldn't honour the insurance!

They've since offered me 2 months of service for 'free' and sent me these drivelly, over-familiar emails suggesting the matter closed.

For what it's worth the phone was worth $1000AUD.

Do I have any sort of case? God, it's so utterly depressing...

Oh, I'm out of work, low on cash but have plenty of time on my hands

posted by a non e mouse to law & government (19 comments total)

You can find a new unlocked Treo 750 online for around $170 AUD. Them throwing in 2 months of free service is a pretty nice gesture and should cover at least half the price of a new Treo.
posted by wongcorgi at 3:03 AM on August 11

They're offering $60 of service.

I was kind of thinking that was a tad patronising, given that this appeared on my paid up bill each month:

'Insurance Charge' is confirmation that you have been issued with an
insurance policy by The Hollard Insurance Company Pty Ltd ABN 78 090 584 473
for the above period. Pay this amount and your cover will be renewed for
another month.
posted by a non e mouse at 3:12 AM on August 11

Have you tried the "Telecommunications Industry Ombudsman" ? - VM's maladminstration of insurance policy sales is probably not within his/her remit but it might be worth a phone call/letter.

The other option I've found surprisingly successful is a recorded delivery letter to the chairman of the company - "I'm sure you would be surprised and distressed to discover ..." etc. State your own case and then chuck in something along the lines of your concern for others who might be unknowingly in the same position - "... feel sure you would wish to rectify this situation".

This does highlight for me something which I'm sure one day consumer law is going to have to address which is that when business transactions are settled solely by a phone call all the power resides in the hands of the person who has a voice recording of the calls and that is, almost invariably, not the consumer.
posted by southof40 at 3:16 AM on August 11

Thanks - I've lodged a TIO complaint, but haven't heard anything as yet.

The letter to the chairman is a good idea... the people I have been dealing with thus far give me the impression that they're concocting pre-formatted responses that make little or no sense...
posted by a non e mouse at 3:23 AM on August 11

The other option I've found surprisingly successful is a recorded delivery letter to the chairman of the company

Just cold-calling some higher-up (e.g. manager of sales) at the main office usually works well for me. Unlike the people at the front-lines, they're usually a lot less eager to "defend the company's honour at any cost" - probably because they understand the actual costs a lot better than the drones manning the support lines.

But don't get your hopes up to high - it's a universal rule that phone companies suck all over the world. Their basic product was commoditized ages ago, and competition has driven prices for that basic product down beneath the real costs, so they have to fuck their customers over in various ways to make money.
posted by effbot at 3:37 AM on August 11

The phone is worth 1,000 AuD? You have confirmation of insurance. Take them to whatever your version of small claims court is. This is a royal screwing, and they shouldn't get away with it. And tell your story to the Consumerist; might help you, and might help push them to get their act together.
posted by theora55 at 5:53 AM on August 11

I do feel particularly violated - royally and otherwise.

They won't send me any documentation or rationale for their decision - which is frustrating.

I do feel like mounting some kind of guerilla social media attack on them if I can't get 'justice', given their reliance on that medium to propagate their brand.

Letters, I'm good at letters. Lots of letters.
posted by a non e mouse at 6:28 AM on August 11

A lawyer friend of mine always says that paying for insureance doesn't buy you coverage, it only buys you standing to sue the insurance company. It probably isn't worth retaining a lawyer in this case. Does Australia have a small claims court?
posted by paulg at 6:42 AM on August 11

Yeah - I might look into that. Have never gone down that path, but there will be a point whereby I have nothing left to lose except to really annoy them as much as I can.

We have the Department of Fair Trading, but I think that's just another complaint mechanism. I'm wondering if it could be considered unconscionable conduct, there seems to be some avenues for pursuing that.

The courts have described unconscionable conduct as:
• serious misconduct or something clearly unfair or unreasonable
• conduct which shows no regard for conscience
• conduct which is irreconcilable with what is right or reasonable.
posted by a non e mouse at 6:56 AM on August 11

Sue.
posted by Bonzai at 8:53 AM on August 11

IANAL, but there is also a question of contractual "consideration." That is, you have to get something for what you signed up and paid for.
posted by rhizome at 10:07 AM on August 11

IANYL, and IAcertainlyNAL in Australia... but if this happened to me in the U.S. I'd be off to small claims court vs both virgin mobile and the insurer so fast that the road would blur under my feet.
posted by paultopia at 11:09 AM on August 11

In the UK you could try the small claims court as others have suggested, but we also have the Financial Ombudsman Service which you can go to with consumer insurance disputes. Does Australia have a similar financial/insurance ombudsman? If so it's likely to be quicker and easier than court action.
posted by pauper79 at 11:57 AM on August 11

I have found that we do have an Insurance/Financial services Ombudsman - which I had not identified in previous searches. Have just sent off another submission.

I'll check Small claims details today.

Thanks for all of this.
posted by a non e mouse at 4:22 PM on August 11

Here is the Insurance Ombudsman URL
posted by a non e mouse at 4:23 PM on August 11

Launch an Executive Email Carpet Bomb. See Consumerist on how to find your exec's contact details. Also make sure that you keep it to the point, keep it civil, and state exactly what action you expect to ensue from your letter.
posted by Susurration at 8:30 PM on August 11

Excellent. Consumerist looks good.

Update - the TIO reckon I have a good case, but need to wait for Virgin Mobile's resolution, before pursuing it further.

Virgin called me today and offered me a refurbished Samsung (he had to look in his box of old phones, he told me, and that was all they had) - so at least they're starting to come to the party. I told them no, of course (the Treo, for all its foibles is a bit more than a shitty mobile phone).
posted by a non e mouse at 8:37 PM on August 11

Thanks for all your responses - I'm off now to bring down the fascist overlord otherwise known as Virgin Mobile.
posted by a non e mouse at 8:12 PM on August 14

So... after lodging several official complaints with various ombudsmi, the Financial and Insurances Ombudsman managed to come through. It was not Virgin Mobile that coughed up the new phone, but the insurance company - even though it wasn't their mistake, they didn't check the contract and billed me for it thereby validating my claim.
posted by a non e mouse at 2:05 PM on September 25