##final
##final (or ##seed) is a type of insurance designed to protect borrowers taking out a loan, mortgage or credit card in the event they are unable to work as a result of sickness, accident or involuntary unemployment. For many years the cover was extremely popular and was sold extensively alongside mortgages, credit cards and personal loans. The cover garnered a lot of profits for lenders and, over the years, it began to be sold by retailers attached to store cards and hire purchase agreements. As the popularity of ##seed grew the standard of some sales began to fall. With huge profit margins and low payout rates, many lenders made more profit from the insurance than they did from the interest from the loan or card to which it was attached. Keen to maximise these profits, many lenders set high sales targets or offered large rates of commission. In some cases this created unhealthy target-led sales environments where the cover was ‘recommended’ to every customer regardless of their situation.
The truth is that ##seed is not suitable for everyone. Many people do not need the cover and many people are ineligible to use it. You may not need the cover, for example, if you have an existing policy in place, if you have sufficient savings or you are in a secure job with sickness benefits. You may be ineligible for it if you are self-employed, are aged sixty-five or over or have a pre-existing medical condition.
Policies may also be deemed to have been mis-sold if the policyholder was only given partial information regarding the policy, for example regarding the costs or terms and conditions, or if they were told the insurance would cover situations that it would not.
The mis-selling scandal has seen thousands of customers making complaints and millions of pounds being paid out in compensation. No one knows exactly how many policies have been mis-sold, but it is likely that thousands more people could be entitled to make a claim.