‘Junk insurance’ refunds owed to millions of Australians after ASIC report

There is $1.6 billion waiting to be claimed by 2.7 million Australians who were tricked into buying ‘junk insurance’ or suffered other dodgy charges. 

A royal commission in 2019 ordered financial institutions to set aside $10 billion to repay the dodgy ‘junk’ insurance policies that were often attached to products such as credit cards and car loans.

Junk insurance is coverage that is considered unnecessary or worthless.

In its latest report financial watchdog the Australian Securities and Investments Commission says there is still $1.6 billion waiting to be distributed among up to 2.7 million Australians.

One way to find out if you are owed money is to use the services of an insurance refund service who will investigate on your behalf.

‘If you’ve ever had a credit card, taken out a loan or obtained finance to buy a car, you’re likely to have unknowingly paid for junk insurance and are eligible for a refund,’ Claimo director Nathan Mortlock said. 

‘If you’re over 60 and had loans during your lifetime, you are very likely to be owed money.

‘Although any loan prior to 2018 is worth investing, we now know the ’90s were notorious for attaching junk insurance to loans.’

One way of checking is to look for the words ‘credit card insurance’, ‘consumer credit insurance’ or ‘loan protection’, these descriptions may appear on or near the ‘interest changes’ line.

Financial institutions were ordered to put aside $10billion to refund those who bought ‘junk insurance’ or were subject to other dodgy charges 

If you find these references, or similar, chances are, you’ve been charged junk insurance and could be entitled to a refund.

Anyone who is unsure about whether they are owed a refund should contact their financial institution.

There is a special call-out for customers that bought Freedom Insurance products from 2010 and 2018, who are urged to come forward.

There is more information for those customers on the ASIC website.