Beresfield resident Melissa Dark is thanking her lucky stars after a junk insurance refund has left her thousands of dollars richer.

She is in fact one of more than six million Australians owed a share of billions of dollars after the big banks unnecessarily charged their clients insurance fees.

According to insurance refund group, Claimo, Ms Dark was, like most, unaware that she had even been charged the feees, let alone due a refund.

Claimo director Nathan Mortlock says his Sydney-based firm has already claimed more than $10 million in refunds for 3,000 Australians.

“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 eligible for a refund,” he says.

“Shockingly one in three Australians have policies that are often worth less than the paper they’re printed on.”

Mr Mortlock says there is a $10 billion refund pool set aside by the big banks to reimburse victims of junk insurance policies.

“We want every Australian to check their personal, home, car and credit card statements,” he told Newcastle Weekly.

“It could be worth a lot of money, and at a time when everyday costs are spiralling, these junk insurance refunds could prove to be a financial lifeline for some families.”

The average Claimo refund is $3,700, with one client achieving a $70,000 refund and a $90,000 claim currently pending.

“A win by Claimo could take care of the household electricity for a year, pay for a new car, holiday or just help with the cost of groceries and petrol,” Mr Mortlake added.

“Some insurances ‘just come with the loan or card’ and we don’t question it.  People think these insurances are mandatory and they’re not.

“What is more shameful, some of these insurances have often been charged as a compounding percentage, which over time, has cost consumers thousands, even up to tens of thousands of dollars.”

The Royal Commission into Misconduct in the Banking, Superannuation and Financial Service Industry in 2019 recognised the misleading practice, directing the banks to contribute to a $10 billion refund pool.

“The Royal Commission ordered the banks to put aside the refund money, but it is up to the individual to apply for a refund. You won’t be getting a call from your bank to offer to give it back,” Mr Mortlock says.

For Ms Dark it was a shock to learn she was owed money as a result of personal loans accrued between 2003 and 2014.

 “I was simply shocked. The first thing I did with the money was pay off debt,” she said.

“In fact, the money I got back from the junk insurance on the credit card, I used to pay off that card. No more loans and no more junk insurance.”

Reading the fine print and understanding what it means is something Ms Dark says she insists on before signing any document now.

“I think that’s where they got me. I was trusting these loans were the right choice, but I certainly learned differently.”

Here is how to check if you may be eligible for a refund (advice from Claimo):

• Look at your credit card statements and loan contracts.
• Look for the words ‘credit card insurance’, ‘consumer credit insurance’ or ‘loan protection’; it may appear on or near the ‘interest changes’ line.
• If you find these references, or similar, chances are, you’ve been charged junk insurance and could be entitled to a refund.

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