Questions of Cash: Now I know two sets of compensation are on the cards from my CPP cover


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The Independent Online

Q. I bought credit card protection insurance from CPP about 20 years ago, but I cannot remember the details, including whether the insurance was sold directly by CPP or NatWest, my credit card issuer. I purchased the insurance as it provided cover for unauthorised transactions on my card and did not realise the bank provided this cover. Each year this insurance has been renewed automatically by CPP. I have now been notified by CPP that I may be entitled to compensation for mis-selling. I have been sent a claim form and told that if I qualify premiums since 2005 will be refunded. I do not understand why premiums before this are not taken into account. If I sign the claim form, it states I will have no further claim on CPP. ST, Essex.

A. We contacted CPP, which explained that under the Scheme of Arrangement agreed with the Financial Conduct Authority regulator the scheme only covers mis-selling since 14 January 2005. You can still claim for mis-selling before this date but you must go directly to the seller of the product. CPP confirmed you had not been sold its insurance by NatWest and requested you contact it direct to establish who had sold the product prior to 2005. You subsequently told us it had been sold by the former Abbey National Building Society, since acquired by Santander. We contacted Santander, which has sent you a claim form. A spokeswoman said: "[The reader] should complete and return the claim form she has received for her post-2005 CPP complaint and we will investigate her pre-2005 claim. Signing the CPP claim form will not affect her claim with us."


Q. I am in the process of changing my car. I am insured through the Post Office with an annual premium of £155.44. My policy expires in October. I phoned the Post Office to change the details of my cover to my new car, which is in a lower insurance group. I was quoted £122.52 to pay extra, including a £20 administration fee. I asked if I cancelled the policy how much I would be reimbursed – the answer was a £23.36 refund, due to the £20 administration fee and £55 cancellation fee. How can they charge two fees? I asked for an annual quote for my new car with the same cover, but in a lower insurance group. The quote was £284, a lot higher than the £155.44 for my old car. I obtained a quote from the Post Office website – changing my name as the site would not quote me first time. It came up with £184 – £100 cheaper. RA, Lincolnshire.

A. You have come up against what might be termed the "insurer's disloyalty charge" – existing customers are charged more than new customers. A spokeswoman for the Post Office put it in different words. "An online quote will attract an introductory discount for new customers, common practice among insurers," she explained. She added: "There are a number of factors which affect the premium following a change of car, including make, model, value, engine size etc. We would like to retrieve [the reader's] quote and discuss it with her, but as she has entered a different name, we are unable to do an accurate comparison. We have listened to the calls with [the reader] and at no point did we advise she would incur two administration fees. We informed her the cancellation fee would be offset against a pro rata refund, representing the unused term of her previous policy and that we would not add any additional fees or charges." Your experience illustrates the importance of conducting price comparison checks annually with an online comparison site, a local insurance broker and a direct insurer.


Q. I had a car insurance policy with One Call, due for renewal in February. I used an online price comparison site to check premium costs. The cheapest on offer was from One Call at £141.99, approximately £30 cheaper than the renewal quote given by them. So I paid with a credit card. I received my certificate of insurance through the post a day or two later. Then I received a letter telling me I had not paid a £25 renewal fee, but this was not mentioned when I took the insurance out online. I queried this with One Call's customer enquiries, pointing out this was not mentioned when I took out the policy. I reluctantly paid, and then received another letter to say my insurance had been cancelled and I would be entered on the police register as having no insurance. I again contacted One Call, who confirmed my insurance was in place. RN, Devon.

A. One Call has not responded to our inquiries, but it has contacted you and refunded the £25. Your story underlines what can be a disadvantage of renewing an insurance policy with your existing insurer – even if you do so via an online price comparison site.

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