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One man received a $10,000 refund he didn't know he was owed: 'It was a nice, stress-free process'
We all know how difficult it can be to make ends meet these days, and every little bit of extra money helps.
That's why we here at the SDC were very interested when we heard about a man in Queensland who received a $10,000 cash payout through a junk insurance refund he had no idea he was eligible for!
So, how did this happen? And could it happen to you too? Let's take a closer look.
If you're unfamiliar, the term 'junk insurance' refers to add-on insurance products that are essentially useless to the person to whom they were offered. This could be in the form of a policy that doesn't apply to the customer's situation, is hard to file a claim on, or just overcharges for services that don't actually exist.
Yes, you read that right: some financial organisations have been selling pure junk to their consumers while pocketing the profits! (You can read more about it here.)
One man unexpectedly received a $10,000 refund from junk insurance claims. Credit: Getty Images. (Stock photo)
Earlier this year, one of these people – Paul, a train driver from Queensland – was contacted by Claimo (a service that helps consumers find and process refunds by launching an investigation on their behalf) and told he might be entitled to some money back. He had no idea he'd even been paying for this insurance in the first place!
'I had a look at my credit card statement and saw that I had been paying for the insurance, so I had a bit of a look online and sent through an application for a refund,' he told a news source.
And just a few weeks later, while Paul was on holiday, Claimo processed his refund application and he received the news he was owed a $10,000 refund!
'It was a nice stress-free process, and because I work shift work, I didn't have much time to spare, but I just sent through the information and bang, I got the refund,' he said.
Paul says he is now saving the refund towards a deposit for a home loan, which is a very exciting development.
Anyone who has taken out a home loan, credit card or personal loan should check their statements for unnecessary fees. Credit: Getty Images (Stock photo)
According to the Australian Securities and Investments Commission (ASIC), 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 2019 report from 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.
ASIC data released in September of this year estimates a further $1.6 billion is yet to be paid to about 2.7 million consumers for remediation for both junk insurance and non-compliant advice.
Claimo 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.
Credit: Claimo.
Australians are asked to keep an eye out for any mail from their banks, super funds, or other financial institutions to find out more about ongoing programmes to fix the problem.
Anyone who thinks they may have been improperly charged a fee should get in touch with the financial institution that made the charge.
You can find more details about the refund on the ASIC website here.
We hope this article has given you some useful information and that you might be able to get your hands on some extra cash you didn't even know you were owed! Stay tuned for more news and tips like this on the forum.
If you still need assistance or have any questions, don't hesitate to contact the SDC staff via our website or the comments area below, and we'll try our best to help!
