Elephant & debt collectors

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I had an insurance policy with Elephant, but in the period I was insured with them they kept on screwing around with my policy. Anyway needless to say I was very annoyed at them (as I hear many others have been with their practices), so I cancelled my direct debit and went for another insurer. I refued to pay their cancellation fee of around £20 on the basis of the poor service I received, and ignored several of their requests for the £19 that I apparently owe them. It now seems they have passed it on to a debt collection agency, and just to get rid of them I decided to pay it, however having phoned the agency they want to tack on £25 "service charge" to this.

Anyway my question is, are they entitled to charge extra? Should I insist that I am only willing to pay the original amount? Is it even worth paying these people?

Any advice would be greatly appreciated!

Cheers

[WWESTY]

Industry practice is to write advising of the extra fees you will incur if you do not settle prior to debt being passed to collection agency. If this has already happened then the collection company are within their rights to claim this fee, however that is not to say that this claim is always allowed....

OFT's "Debt Collection Guidance" July 2003

said:

2.32 The OFT's previous guidance on charging, issued in January 2000, covered the following: • there is no legal basis to claim collection costs in the absence of express contractual provision • debtors should not be led into believing they are liable to pay charges when this is not the case, and • even if collection charges are allowed for in the contract we may still regard the levying of charges as unfair where they are of an unreasonable amount or disproportionate to the main debt. 2.33 We believe that guidance is still valid and that when referring to reasonable costs we should include reference to actual necessary costs.

I would recommend that you send a cheque for the original debt, and I would wager that you will hear nothing more........but I didn't tell you that.....