You are here: Home - Insurance - News -

Mail order firm to pay £12.5m to customers over worthless insurance

0
Written by: Paloma Kubiak
17/02/2017
Clothing firm Express Gifts Ltd has agreed to pay £12.5m redress to 330,000 customers who were sold insurance that offered “little or no value” for the actual items they bought.

The direct mail order and online business predominantly sold items of clothing but it had the permission to sell general insurance products too.

These insurance products covered against accidental damage and theft for all products bought from their ‘Ace’ or ‘Studio’ brands.

It was called “Property Insurance” from January 2005 to August 2008 and “Purchase Protection Insurance” from September 2008 to May 2015, with the premiums calculated as a percentage of the customer account balance.

However following its own “quality assurance activity” the firm has agreed with the city watchdog, the Financial Conduct Authority (FCA), that the insurance cover sold did not provide adequate value to the 300,000+ customers.

This is because although it covered all items bought, its predominant business was selling items of clothing which customers don’t generally insure.

This cover is no longer offered by the firm but Express Gifts Ltd has agreed with the FCA to provide £12.5m redress to customers affected.

It will write to all affected customers with details of how they will be paid the redress due. Any redress will be sent automatically, so customers don’t need to do anything.

But the FCA recommends that if customers have any questions or would like further information, or their contact details have changed, they should contact Express Gifts Ltd directly.

Jonathan Davidson, director of supervision – retail and authorisations at the FCA, said: “We expect firms to identify where insurance products of little or no value have been sold to customers and take appropriate action. There is a responsibility on firms, whether they are responsible for the design or the distribution of these products, to ensure the products offer value for their customers.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
2357715-home-property-management
Revealed: the London borough with 700% house price growth over 20 years

Hackney in North East London has experienced the fastest growth in house prices in the capital over the past 20...

Close