There is a lot of confusion among people about what their insurance policy covers. All the things people think they are covered for and are not, and on the other hand, all the things they can claim for and often do not realise they can. Meanwhile, getting an insurance policy is undoubtedly an effective means of saving for the future, but do you know you are getting trapped in fraudulent activity? Yes, you read it right!
Junk insurance is a term used to describe the add-on insurance policies sold at the time of the purchase and provide no or little value to a purchaser. The purchaser usually doesn’t even know that they are paying for something so useless that they will never be able to use it. Recently in 2018, the Banking Royal Commission revealed this national scandal and asked the banks and insurance companies to refund the premiums. So, if you also are unsure whether you are eligible for a junk insurance refund or not, continue reading!
What Is Junk Insurance?
As the name suggests, junk insurance is a term used for add-ons or insurance products that are unnecessary or worthless to a consumer. These policies are called so because they are sold to you without your proper consent or understanding; you are not told about what is covered and what is included or excluded. So, there are chances the agent might have signed you up using dodgy sales tactics.
These add-on policies might be entirely worthless to you as you will never be able to claim these policies, even if you know you had them. Some of these policies provide coverage for things that are automatically covered under other policies or consumer law. Still didn’t get it? No need to fret! Here are some common examples of Junk insurance that you would have signed up for but are unaware of. Read on!
- Mechanical breakdown insurance (MBI): MBI provides additional coverage on manufacturer parts of your automobile. This sounds good, but you are eligible to claim it only when your manufacturer warranty is over. Thus you will be paying for it for years but will not be able to use it.
- Guaranteed Asset Protection (GAP): GAP is meant to cover the gap between an insurance payout and the money you owe on your car finance. This is an extra cost that you don’t necessarily need to pay.
- Consumer Credit Insurance (CCI): CCI is designed to cover you if you are unable to repay your loans under various circumstances like injury, disability, job loss, etc. In reality, it is the cost of the service attached to credit cards and loans, and you might not ever realise that you were paying for it.
How Do You Know You Are a Victim of Junk Insurance?
If you are unsure whether you have paid for junk insurance or not, you can find it out from your old credit card and old statements. The insurance payments you make are added to your loan or credit card account, so you might get a clue by checking your old statements. You can request your payment statements from your financial institution and carefully analyse the details to find out whether you were paying interest for junk insurance or not. Another efficient and effortless way to find it is to team up with a remediator and allow them to do this cumbersome task for you. They offer you the best and most reliable solution to get your junk insurance refund without much hassle. Meanwhile, if you are thinking of doing it yourself, you would need to look for terms like Loan Protection Insurance, Mortgage Protection Insurance, Mechanical Breakdown Insurance, Extended Warranty Insurance, Guaranteed Asset Protection, and Consumer credit insurance. Hence, if you think you may have been a victim of these insurance add-ons, without any delay, request your refund now!