How to reclaim a mis-sold payment protection style add-on
PPI made the headlines, but the same selling tricks live on in a whole family of add-on policies: payment protection style cover, debt or income protection bolted onto a loan, GAP insurance sold on the forecourt, and various protection plans tacked onto credit and store cards. Many were sold to people who were never eligible to claim, never told it was optional, or never told the price. If that sounds like yours, you can ask for the premiums back plus interest. The route is the same proven complaints process that recovered billions in PPI, and you run it yourself.
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These add-ons are regulated insurance products under the Financial Conduct Authority. The seller had to follow the Insurance Conduct of Business Sourcebook (ICOBS), which requires information to be clear, fair and not misleading and, where advice is given, the sale to be suitable. A policy can be mis-sold if, for example, you were not eligible to claim, you were told it was compulsory, the cost was not made clear, or you were pressured into it. The FCA Consumer Duty reinforces that firms must deliver fair value and good outcomes. Your remedy is to complain to whoever sold it. They must give a final response within 8 weeks. If they reject you or go silent, you can take the complaint to the Financial Ombudsman Service for free. The time limit is normally 6 months from the date of the final response, and generally within 6 years of the sale or, if later, 3 years from when you reasonably became aware of the problem. If the complaint succeeds, the aim is to put you back in the position you would have been in, which usually means refunding the premiums plus interest to reflect being out of pocket.
Step by step
- 1Dig out the paperwork. Find the loan, finance or card agreement and any policy document showing the add-on and what you paid. If you cannot find it, the lender should provide it on request, and you can make a subject access request for your personal data for free.
- 2Identify why it was mis-sold. Common grounds: you were self-employed or had a condition that made you ineligible to claim, you were told the cover was required to get the loan, the cost was never explained, or it was added without a proper conversation.
- 3Send a written complaint to the seller setting out the grounds and asking for a full refund of premiums plus interest. Reference ICOBS and explain why the sale was unfair or unsuitable. Keep it factual and specific to your circumstances.
- 4If they reject the complaint or 8 weeks pass with no final response, refer it to the Financial Ombudsman Service at financial-ombudsman.org.uk. It is free, you do not need a claims company, and you keep all of any refund awarded.
What they'll say, and your comeback
“You signed the agreement, so you agreed to the add-on.”
Comeback, A signature does not make a sale fair or suitable. If you were not eligible to claim, were misled about the price, or were told it was compulsory, it can still be mis-sold regardless of your signature. That is precisely what ICOBS and the Ombudsman test for.
“The complaint is too old, the policy ended years ago.”
Comeback, The Ombudsman can usually still look at a complaint within 3 years of when you reasonably became aware there was a problem, not only from the sale. If you have only now realised it was mis-sold, say so clearly and explain when and how you found out.
“We have no record of selling you this policy.”
Comeback, Make a subject access request for your personal data, which is free. If you were charged a premium, there is a paper or banking trail. Bank statements showing the deductions are evidence in themselves.
FAQ
Do I need a claims management company to do this?
No, and you do not have to pay one. They take a cut, often a big one. The complaint and the Ombudsman are designed for you to use directly, for free, and you keep the entire refund.
What can I actually get back?
If the complaint succeeds the usual aim is to refund every premium you paid for the add-on, plus interest to reflect being out of pocket. If the cover was added to a loan, you may also recover interest you were charged on those premiums. The exact interest rate is set by the Ombudsman's approach at the time your case is decided.
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Reclaim it now, free →More money you might be owed
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A self-serve tool, not a law firm. General information, not legal advice.