Five Questions About: Card protection plans

 

What's this, a new mis-selling scandal?

Actually, yes it is. Insurance which supposedly protected you if your credit card was stolen has been mis-sold to around 4.1 million people since 2005.

Does that mean I'm in line for a payout?

If you were sold the useless cover, yes. It was flogged to around 300,000 people by CPP, which was fined £10.5m this week for the scandal. A further 4.1 million folk were sold cover by RBS/NatWest, Santander, HSBC, Barclays and Nationwide building society.

How much might I get?

It won't be a fortune. You should get back all the premiums you paid since 2005 plus interest at 8 per cent. But with the policies costing £35 a year for card protection and £84 for identity protection, payouts are unlikely to be higher than about £700. The total compensation bill is £14.5m from CCP and an estimated £200m from the banks.

How can I claim?

That's still to be decided. If you took out a policy direct with CPP it should write to you explaining how to claim. If you were sold one through a bank, it's hoped the bank concerned will take responsibility to contact you, as has happened with payment protection insurance.

What will be the next mis-selling scandal?

Who knows! Illegal payday loans maybe?

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

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