Millions of Aussie credit card holders and borrowers are urged to check if they're eligible for a junk insurance refund.
In 2018, a Royal Commission into misconduct in the banking industry revealed that financial institutions had ripped off customers by selling unnecessary and worthless insurance products attached to loans and credit cards.
They were ordered to set aside $10billion to reimburse impacted customers.
The federal government also introduced stricter regulations to improve the transparency of add-on insurance products to ensure consumers are not sold policies that they do not need or cannot use.
However, new data from the Australian Financial Complaints Authority has revealed that junk insurance complaints have skyrocketed by more than 1400 per cent in the last five years, including 7880 in 2024-25.
Of an estimated 4.7million Aussies who have been sold junk insurance since 2010, only a fraction have come forward to claim the payout they're entitled to, according to Claimo.
The claims management company has helped 1600 Australians secure more than $5million in refunds for insurance policies that provided little or no real coverage.
'With cost-of-living pressures continuing to mount, these unexpected refunds can act as a meaningful buffer - helping households cover rising expenses without taking on additional debt,' Claimo director Nathan Mortlock said.
Millions of Aussies could be eligible for a refund after being sold junk insurance
Payouts vary from hundreds to thousands, depending on the policy that was purchased
'Even if nothing is found, checking can give people peace of mind – but many are surprised by what they're owed.'
Aussies who have had car loans, mortgages, credit cards and personal loans since 2010 are urged to review those policies to check if junk insurance was added without their knowledge.
Refunds vary from hundreds to thousands, depending on the policy.
The claims process is usually finalised within 12 weeks.
Victorian customer Agis Vlahos recovered almost $4,000 after an investigation into old accounts revealed that consumer credit insurance had been attached to a personal loan.
'With the cost of living so high, it was reassuring to recover money that shouldn't have been taken in the first place,' he said.
'A lot of people simply don't realise they may have been paying for insurance they never needed.'
Consumers are also urged to be vigilant about the potential risks associated with taking out a loan, mortgage or credit card and ensure they read the fine print before signing up to a policy.
Visit the Claimo website to find out more.