As many as 2.7 million Australians could still be eligible for a share in billions of dollars worth of refunds following a finding in the banking royal commission.
The Australian Securities and Investments Commission (ASIC) says remediation is still available for millions of Australians for “fees for no service misconduct or non-compliant advice” as well as ” junk insurance” cashback payments.
A report from back in 2019 by the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry revealed that millions of people had been duped into buying junk insurance.
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Financial institutions were ordered to set aside $10 billion to refund people who purchased junk insurance.
Junk insurance refers to coverage that’s either unnecessary or worthless.
However, new data released in September 2022, by the Australian Securities and Investments Commission (ASIC), estimates a further $1.6 billion is yet to be paid to an estimated 2.7 million consumers for remediation for both junk insurance and non-compliant advice.
“Our guidance puts the onus on industry to get on with fair and timely remediations – returning the money they owe to wronged consumers,” ASIC Deputy Chair Karen Chester said in a statement.
“To date, ASIC has needed to oversee large-scale remediations, to ensure affected consumers were treated fairly and received the compensation they were entitled to.”
One of the services that helps consumers find and process refunds is Claimo.
Claimo helps Australians who may have been charged these fees get their money back, by launching an investigation on their behalf.
CEO Nathan Mortlock said the most common reason people bought junk insurance was because they were told it was necessary.
“A lot of the time they were told they had to have that insurance to get that home loan back in the ‘90s and also the ‘00s, and we know that’s actually not the case,” he said.
While some people come forward to Claimo knowing they have been wrongly charged, many of their customers had no idea prior to their Claimo investigation.
A spokesperson for Claimo added that they expected “millions more Aussies could be owed billions more in junk insurance refunds in addition to the ASIC remediation programs already paid”.
They said a recent example of a successful remediation was a Sydney man who had found out about the add-on insurance from a previous 7NEWS story, then contacted Claimo, who manged to get him back more than $8200.
How to claim
Australians are urged to keep an eye out for any correspondence from their banks, super funds, or any other financial institutions for more information about ongoing remediation programs.
Those who are unsure about any fees are urged to contact the financial institution that charged them to find out if they have been incorrectly charged.
For those customers who had policies with Freedom Insurance, there is a specific call to action, however.
Those who have been with the insurance company anytime from 2010 and 2018 are urged to come forward to see if they are eligible for a refund.
More details about the refund can be found on the ASIC website here.