25th July 2014
Half a million consumers who were duped into buying card or identity protection insurance by Card Protection Plan (CPP) have less than five weeks to make a claim for compensation.
The City watchdog, the Financial Conduct Authority (FCA), has urged consumers who were mis-sold to by CCP must submit claims for compensation no later than 30 August and forms received after this date will not be considered.
The regulator has said the average claim against CPP has results in consumers receiving £188 as card protection costs around £35 a year and identity protection costs about £84 a year.
CPP was fined £10.5 million in 2012 for widespread mis-selling of its card and identity insurance and agreed to pay £14.5 million in compensation to consumers. The company told consumers they would benefit from up to £100,000 worth of insurance which was not needed because they were already covered by their bank in the event of card or identity theft. CPP also overstated the risks and consequences of identity theft.
CPP sold 4.4 million policies and generated £354.5 million of profit by selling unneeded insurance policies through its own sales channels and through high street banks, which introduced customers to CPP.
The redress scheme was voted for by 1.3 million CPP policyholders last year but the FCA said of those that voted for the scheme, 500,000 have yet to complete their compensation forms.
Those who wish to make a claim must do so using their original form that was sent to them as photocopies will not be accepted.
Clive Adamson, director of supervision at the FCA, said: ‘The CPP redress scheme is drawing to a close but there is still time for people who have not claimed to do so. If you believe you were mis-sold one of these CPP protection products but did not get a letter or threw it away, contact the CPP scheme helpline immediately and check whether you are eligible to claims.
‘This simple and transparent compensation process means that customers who believe they were mis-sold the product have an opportunity to get their money back with interest regardless of whether they bought the protection product from a bank, card provider, or CPP.’
More information about the CPP redress scheme is available on its website: http://www.cppredressscheme.co.uk – or by calling the freephone number 08000 83 43 93