Misrepresentation, Undisclosed Finance Charges and Excessive Cancellation Costs

I purchased a maintenance/insurance plan after being informed on the sales call that it covered chips - which i thought was windscreen chips, but when I later submitted a claim, I was told it only covers paint chips — not window chips.

I then cancelled the policy.

Only at cancellation stage did I discover that this was not a simple monthly insurance premium. The full lump sum of the maintenance plan had been added to my vehicle finance agreement. I never received or signed an amended finance agreement authorising this.

Here is what happened financially:

I was charged R4,950 for the maintenance plan.

I was charged R1,364.77 for “unearned finance charges” (never explained to me at point of sale).

Upon cancellation, a further R4,654.55 was deducted as a cancellation fee.

I was refunded R3,448.05.

Total cost to me: R7,521.27 — despite only having the cover since August.

It is unreasonable that cancelling a R4,950 plan results in costs almost double the value of the plan.

I have requested:

A full itemised reconciliation,

The contractual clauses authorising these deductions,

Their final written position on the dispute.

More than five business days later, I have received no response. I have now raised the complaint with the ombudsman.

This experience raises serious concerns about:

Transparency at point of sale,

Disclosure of financial implications,

Capitalisation into finance agreements without clear written consent,

The fairness of cancellation penalties.

I have escalated the matter further and would caution others to fully understand how these products are structured before agreeing to them.