EVER HAd a Personal loan?
you could be owed a refund of $100s or $1,000s in refunds for junk insurance
Joel Gibson, Consumer Expert
have you ever had a personal loan?
If you have, you could be one of about 1 in 4 Australians who paid for so-called ‘Junk Insurance’ on loans and credit cards - and that means you could be entitled to a refund.
Banks, car dealers and insurance companies added dodgy ‘add-on insurance’ to about 5.6 million loans and credit cards. That’s more than one policy for every 4 Australian adults.
It’s become known as ‘Junk’ because many of us didn’t need it, couldn’t claim on it, or didn’t even know we were paying for it - and it only paid back a fraction of every dollar we spent on premiums.
Fortunately for us, these rip-offs have been exposed by the financial watchdog ASIC and the 2018 Banking Royal Commission.
And now YOU could be entitled to claim back thousands of dollars in pointless premiums, PLUS the interest you paid on those premiums if the insurance policy was added onto the loan!
FACT: By April 2021, 580,000 Australians had already been repaid over $250 million for dodgy sales of Consumer Credit Insurance (CCI). The AVERAGE claim so far was $430.
Get your FREE eligibility check here if you haven’t already done so.
And read on if you want to know all about how to get your refund for Junk Insurance on a Personal Loan.
Tegan from Western Australia
"Thanks so much to the Remediator team for getting me back over $1,200 for CCI sold on a credit card/personal loan.
The service was fast, efficient and I would absolutely be using their service again. I will be recommending it to all my friends and family! I’m very happy with how fast things were handled and surprised I secured anything back."
How do you know if you've paid for junk insurance on a personal loan?
Chances are, you may not know! At Remediator, we’ve found that many of the claimants we help were paying for Junk Insurances on their loans without even realising.
Even if you did know, you could be entitled to your money back. Some claimants were never eligible for this insurance in the first place, or were already covered by another policy.
REAL-LIFE EXAMPLE, FEBRUARY 2014:
"A personal loan CCI policy was sold to a consumer working less than 20 hours per week. The consumer later became unemployed and lodged an insurance claim for unemployment benefits. The claim was declined on the basis the consumer was not working the required minimum of 20 hours per week for the six-month period leading up to the claim date. When the policy was taken out, proper checks were not performed to ensure the consumer was eligible to claim for the benefits under the CCI policy.”
If you were one of millions who fell victim to this rort, there might be some evidence in your old loan statements. Look for language such as “Consumer Credit Insurance” or “CCI”.
But beware it can be tricky to identify: some lenders re-named or ‘re-branded’ it with their own in-house name for the policy. Others used external insurers with a different name.
St George / BankSA / Bank of Melbourne
QBE (general insurer), OnePath Life (life insurer)
St Andrew’s (general insurer), St Andrew’s Life (life insurer)
St Andrew’s (general insurer), St Andrew’s Life (life insurer)
IAL (general insurer)
CMLA (life insurer)
IAL (general insurer, 2013–15), Credicorp (general insurer), St Andrew’s Life (life insurer, 2015–17)
Hallmark General (general insurer), Hallmark Life (life insurer)
MLC (life insurer)
Swann (general insurer), IAL (general insurer, 2017), St. George Life (life insurer)
No general insurer, 2013–16, AAI (general insurer, 2017), Asteron Life (life insurer)
Westpac General (general insurer), Westpac Life (life insurer)
You can request your statements from any financial institution and comb over the details, or you can ask Remediator to do the hard work for you.
Don’t know if you’re a victim? Contact Remediator and ask us to do a free eligibility check.
What is consumer credit Insurance (cci)?
Consumer Credit Insurance (CCI for short) is the predominant type of ‘Junk Insurance’ or ‘add-on insurance’ that Remediator is finding attached to personal loans.
CCI is supposed to cover you if for various reasons you can’t afford the repayments on your personal loan.
According to ASIC Moneysmart, consumer credit insurance (CCI) can provide some cover if:.
You can't meet the repayments because you lose your job, you are sick or injured, or you die.
Goods you buy using your credit card or loan are damaged, lost or stolen.
Every CCI policy is different but it might, for example, cover your loan repayments for a period or it might pay the loan off if you die.
But the financial watchdog and the 2018 Banking Royal Commission showed how little value CCI had delivered to customers, because it often wasn’t explained to them, or it wasn’t appropriate for them, or it was pushed on them by high pressure sales tactics.
FACT: For every dollar spent on Consumer Credit Insurance (CCI), only 19c was paid back in claims (compare that to car insurance, which returned 89c per dollar).
It might also be unnecessary. If you have life insurance or income protection insurance, for example, that covers you for sickness, injury and death.
Home, contents or car insurance may cover goods you buy that are damaged, lost or stolen.
Ever Had A Loan With Any Of These Banks?
Suncorp, BoQ, CUA, Bendigo Bank and ANZ were the worst lenders when it came to paying back just cents in the dollar to customers for Consumer Credit Insurance on personal loans.
All four paid back less than 14c for every dollar they collected in premiums. How’s that for lousy value?!
But all the big banks and a number of second-tier banks in Australia were selling CCI to Personal Loan customers at some point in the past decade.
An ASIC investigation into CCI covered the following 11 lenders. So if you’ve had a personal loan with any of these brands in the table below, you might be entitled to your money back for Junk Insurance premiums.
HOW MUCH DID CCI PAY BACK ON PERSONAL LOANS FROM 2011-2018? (ASIC)
Cents In The Dollar
Not all banks are proving to be equally refund-friendly when it comes to Junk Insurance refunds. The financial watchdog ASIC has acknowledged that some are more prepared than others to give claimants the benefit of the doubt.
“We are also seeing some positive signs from firms who are looking at ways to fast track remediations, including through the use of beneficial assumptions,” ASIC said.
At Remediator, we apply a ‘horses for courses’ approach and deal with each bank differently, depending on their policy. So wherever you had a Credit Card, we can give you a fighting chance of getting your money back.