The redress scheme for the two million flogged worthless card security insurance from Affinion (often branded Sentinel) has now closed, but you might be able to claim for old policies. Or you've got until 16 September for "exceptional cases" to be considered.
If you think you were mis-sold the insurance before 2005, this guide will also show how to complain to your bank and then escalate to the free Financial Ombudsman if you don't have any success.
In this guide...
What is AI?
Affinion International (AI) sells card protection policies, which cover a number of things and used to include fraudulent use of lost or stolen cards. This element, which it called 'card security', is normally useless as card issuers are typically responsible for fraudulent transactions anyway.
While it was this one element of a larger policy that was mis-sold, you could nevertheless claim for the whole cost of card protection under the scheme for products sold between 14 January 2005 and August 2013 – when the worthless element of the product was removed.
How did Affinion mis-sell?
Only some customers actually purchased the card protection from Affinion. It was mostly sold by banks when people applied for credit cards. We've heard many tales of bank staff persuading people to take out these policies and not explaining they'd probably be covered anyway.
Why do people fall for these products?
Imagine before you started reading this guide, someone offered to sell you "Martin Lewis punches you in the face insurance" against the event he'd find you and smack you.
Of course it's ludicrous. But, wouldn't you think: "There must be a reason they're selling this insurance? He must've done it before. They wouldn't be selling it unless there was a tangible, manifest risk."
Now you've thought that, it starts to create a doubt. "Maybe you should get it, after all it's not that expensive, and peace of mind against being lamped on the nose is important."
Sound ludicrous? Well now turn it to a financial example, where people know less about the facts. Building fear, employing PR people to pump up ID fraud worries, helps sell policies. Millions signed up to CPP to protect against a conjured risk that sounded believable. In the end it emerged that the same thing happened here.
Did I get this product with my debit or credit card?
The product would have been added to a credit or debit card or sold as part of a packaged bank account – where you pay a monthly fee for added extras such as travel insurance and breakdown cover. However, the scheme only applies to customers who had the cover as part of a standalone product, not as part of a packaged bank account.
What did card protection cover me for?
The typical features of a card security product include:
• Being able to cancel lost or stolen debit or credit cards and request replacements in one phone call to AI’s contact centres, which are open 24 hours a day, seven days a week;
• Insurance cover to replace a lost or stolen handbag, purse, wallet or briefcase;
• Emergency cash advance service when cards are lost or stolen;
• Insurance cover to replace personal cash lost or stolen at the same time as a card is lost or stolen;
• Insurance cover for the telephone and communication costs of dealing with the loss of your card and personal possessions including identity documents, eg, passports;
• Insurance cover for replacement of lost or stolen car or home keys and replacement of locks for your home; and
• Insurance cover for fraudulent use of lost or stolen cards (now removed from all products, this is the element the redress scheme is based on).
Does this have anything to do with PPI or CPP?
No. This is nothing to do with payment protection insurance (PPI), or the Card Protection Payment (CPP) Scheme of Arrangement. However, there are huge similarities between the AI Scheme and CPP redress schemes and we expect that we will see similar outcomes with this redress scheme. For more information on CPP see the guide.
What happened to the AI scheme?
The AI scheme was set up in August 2015 to refund people who were mis-sold card protection from January 2005 onwards. If you think you should have been eligible for the scheme but didn't recieve a letter then you still might have a chance to claim by getting in touch with the Financial Ombudsman Service. If you think this applies to you then follow the steps below to complain to the ombudsman.
Or if due to exceptional circumstances you weren't able to meet the deadline, there's also a deadline of 19 September 2016 to let Affinion know why you weren't able to meet the deadline and get your claim considered. As an example, if you've been out of the country for a long period of time, the deadline could be extended for you.
Report your own successes and failures in the forum.
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If you think you were mis-sold a card protection product from your bank/card provider before 2005, then you have a right to reclaim your money back.
You can complain to your bank/provider, but if you've switched card provider since you were mis-sold, you will need to complain to the provider that originally mis-sold you the products and have the paperwork to hand from that provider.
These things are best done in writing, but if that's too difficult, don't worry about calling. Just ask the provider to note it down as a formal complaint, and also ask for written confirmation.
To help, we've put together a template letter to start you off – download it and fill in the blanks (use it to help start you off, but the more you write in your own words, the better):
FREE template letter! Download our card protection reclaim letter. Make sure you keep a copy. It'll be helpful if you go to the Ombudsman.
We don't yet know banks' attitude to these complaints. But at the start of similar past reclaiming campaigns, such as PPI and CPP, banks rejected many cases the Ombudsman later upheld.
They do this deliberately, as they know most people won't take it further. Often, the rejection sounds legally definite. Yet don't let that put you off. If you feel you were treated unfairly, if they reject you then it just enables you to contact the independent Financial Ombudsman Service (FOS).
Banks have eight weeks to respond. If you don't hear anything, or you're not happy with how it's dealt with your complaint, don't give up – go to the next step.
What if I have a card protection product from before 2005 that I renewed and kept on after that?
If you bought a product before 14 January 2005 but renewed it after this date then you can make a claim under the AI Scheme but ONLY for the part you had after 14 January 2005.
You can still claim for any product bought before that date, but you'll have to do it yourself (you can use our templates above to help you out).
So effectively if you had the product from before 14 January 2005 to after that date you would have to make two claims – one that can be submitted under the AI Scheme and one that you have to do yourself.
If you tried the option above and didn't have any success, don't assume that's the end of the matter. You have a right to take ANY complaint that's turned down to the independent FOS.
This is the official body for settling disputes between individuals and financial companies. It's a free service that acts as an impartial adjudicator. Present it with the facts, and it'll decide whether the circumstances your protection plan was sold under were unfair. Read more on the Ombudsman
If it finds in your favour, it'll then decide what redress is required. In most successful mis-selling cases, this means a refund.
BUT it's important to note it won't look at your complaint until you've contacted your bank and given it eight weeks to respond. Once you have a response, or haven't been given one within eight weeks, only then will it be able to investigate your complaint.
To get the ball rolling, you'll need to fill in its complaints form below, which must be signed by hand and posted. Make sure you enclose any paperwork that backs up your case.
As with the first letter to the bank, which you could always copy and paste into the form, don't feel you have to be formal. Explain the point clearly, concisely and honestly, all in your own words, just as if you were explaining the situation to a friend.
It's quite simple to fill in, though take care. If you need help filling it out, you can call FOS on 0300 123 9123 or 0800 023 4567, and it'll guide you through the claim, or use our step-by-step guide below.
The guide's written in Microsoft Word so you can easily cut and paste sections or print it and have it next to you as you're filling in the Ombudsman's form.
How long will this take?
Sometimes this will take a long time. Possibly around a year, but maybe even longer as the Ombudsman deals with huge numbers of complaints – especially with the current avalanche of PPI mis-selling issues. But don't worry – you can leave the matter to the Ombudsman to resolve and it will contact you with any offers from your lender.
What happens if I get turned down by the Ombudsman?
The Ombudsman's decision is usually made by an adjudicator. If you disagree with the result, you can ask for a formal decision to be made by one of the official ombudsmen at the service. This usually takes several months as it involves a detailed investigation, but don't be afraid to push your complaint if you think the initial decision isn't right.
After that, while the finance company must accept the Ombudsman's decision, you still have the right to take the company to court if you don't agree with the result.
It's also worth noting that if you feel the Ombudsman hasn't handled your case correctly, eg, there were unnecessary delays, you can ask for a senior manager to review it. If that doesn't resolve things, you've a right to go to the Independent Assessor (though this is only about quality of service, not the actual decision made).
For other complaints the Ombudsman can help with, see the Your Financial Rights guide.
How far back can I claim?
As long as you claim within three years of knowing you could claim, there's no problem, even if the mis-selling happened a decade ago. This issue only hit mainstream news headlines in late 2012, so you should be fine.
I asked to take out the policy, but didn't use it. Was I mis-sold?
The key here is whether you could have used the policy. If you were eligible but simply never had a need to use it, that's not mis-selling - unless you never realised you actually had the plan.
The account holder's deceased or needs help, can I do this?
If the account holder has passed away, any monies owed become part of their estate, so the person who inherits is entitled to reclaim (let the executor know too). If there's no will, this follows the rules of intestacy (see the Gov.uk website). Yet there may be problems proving what happened at the time of the sale if only the policyholder was present.
If someone you know requires help with their finances, and they're capable to instruct you to act on your behalf, it's worth trying.
If the person has a mental health condition, or other issues that mean they didn't fully understand the product being sold, they are more than likely to have a case.
Can my bank punish me for complaining?
No, you have a right to complain and take it to the Ombudsman. Your bank can't put the fact you've complained on your credit file, for example.
Past Ombudsman rulings show your bank can't use this to change how it treats you, though of course, if it agrees you were mis-sold, it can end your plan (if you haven't cancelled already).
The one negative, though, is the bank will know this information when you apply for another product from it (not any other bank), and it could decide to incorporate that into its decision, but past experience shows this is unlikely.
What are my chances of success?
Given the massive scale of the mis-selling uncovered by the Financial Conduct Authority, we think you've got a good case, even if the mis-selling happened before 2005.
But don't take any chances. Explain exactly how it was mis-sold, and make sure you provide evidence where necessary.
Whether you've had success or not making a claim, let us know how you got on. That way we can keep our guide up-to-date and help as many people as possible.
Ask us questions and give your feedback
Report your card protection plan reclaiming successes and failures in our forum. Also let us know any extra questions you'd like us to answer.