We’ve all heard of the millions of customers throughout the UK who have been mis-sold Payment Protection Insurance (or PPI as it’s more colloquially referred to when we answer the phone to one of the numerous PPI claims companies who regularly contact us), yet it now seems there’s a new ‘unfairly sold insurance’ kid on the claims block; namely identity theft insurance.
And already victims who unwittingly found themselves forking out for identity fraud insurance payments in the aftermath of signing up to Experian’s Credit Expert service, are receiving compensation according to various sources.
The Credit Expert policy offered by Experian – and snapped up by thousands of customers wishing to manage their own credit ratings records with a view to applying for future loans and credit cards – cost £14.99 per month, and between January 2011 and July 2014 the policy was said to have included an identity protection cover.
Unbeknownst to customers taking advantage of this service – which was designed to pay-out if fraudulent parties succeeded in compromising customer’s online ID – they were being charged for a largely unseen insurance.
Identity Fraud Insurance Could Be the Next PPI
The only time many customers were made aware of the hidden insurance charge was at the point they looked into cancelling the service, when they were duly informed that should they choose to terminate this masked additional element (which they knew nothing about previously) then they would immediately save £6 per month.
Clearly shocked to learn of what appeared to be duplicity on the part of household name credit ratings agency, customers approached Experian to raise their objections.
However, finding their complaints falling on deaf ears they instead took their justifiable gripe higher and turned to the Financial Ombudsman. It was only then that their complaints were taken seriously and acted upon as the independent financial industry regulator upheld their derision.
In the event, up to a third of complainants are now said to have received compensation, while thousands more could be in line for a pay-out in the foreseeable future.
Although not on the scale of miss-sold PPI, this identity fraud insurance debacle is yet further proof that various organisations and industry sectors have been trying to hoodwink the public in recent years, with ambiguous and elaborately-defined proposal form documentation more often the key.
Indeed, a Financial Ombudsman spokesman said (and exclusively in relation to Experian’s Credit Expert pre-contract paperwork); “A lot of the time, these insurance boxes were pre-ticked, and the customer did not have the option to untick them”.