You could be one of the many people that is throwing their money away on "useless and expensive insurance", according to Which?
The independent consumer advice organization says that life insurance and separate cover for cars, buildings and contents is vital.
However, it argues that other cover such as ID theft insurance, extended warranties and payment protection insurance (PPI), is often completely unnecessary.
The insurance industry says that we as consumers should think about our own circumstances to ensure we have "adequate cover".
Which? advises you against taking out the following:
- extended warranties
- identity theft cover
- PPI
- mobile phone cover
- accidental death and injury cover
It said many of us are paying for insurance when we are already protected by existing policies, while others of us are taking out cover which is unlikely to pay out.
As an example, under the banking code, if we are an innocent victim of ID fraud, we should be reimbursed by our bank or building society.
In addition, Which? argues that accidental death and injury cover is often included under life insurance, while mobile phones can be protected as part of home contents insurance.
Payment Protection Insurance (PPI) has proved extremely controversial in recent years.
In the case of PPI (the subject of a long-running Which? campaign) it has premium costs and "high obstacles" which often prevent successful claims.
It is supposed to cover repayments on your loans, mortgages and credit cards if you are unable to make them as a result of accident, sickness or unemployment. But PPI has been widely criticised for being expensive and offering only limited benefits.
Earlier this month the Financial Services Authority (FSA) fined HFC Bank (part of the HSBC group) £1 million for failing to ensure 163,000 consumers were properly advised when they bought the company's PPI. This was the largest fine the FSA has imposed in this area.
The Financial Ombudsman Service (FOS) has also seen a sharp increase in PPI complaints; it has dealt with over 5,000 complaints in first nine months of the present financial year, compared with just under 2,000 at the same point last year.
- What if I have been sold Payment Protection Insurance?
If you have ever borrowed money in the form of credit cards, a car loan, consolidation loan, or a mortgage, then it is very likely that you have been sold Payment Protection Insurance (PPI).
This could mean you could be owed thousands of pounds in compensation.
If you think you might have a claim, then you should use a reputable and regulated no win no fee claims firm that could help you win compensation.
For more information on how to make a claim for PPI, you should consider Claims Financial.
Responding to the Which? research, the Association of British Insurers (ABI) said it was up to consumers to make sure they do not waste money on unnecessary cover.
In terms of PPI, the FSA has acknowledged that "when correctly sold", the insurance provides "valuable protection for many customers".
So, if you think you have been wasting money on your insurance, isn't it time you stopped?
And maybe it's time for you to claim back the money you wasted on needless insurance?
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