Barclaycard has announced it will stop selling ID theft insurance provided by CPP when customers call to activate a new credit card.
CPP Identity theft insurance dropped
The decision comes hot on the heels of the recent announcement that CPP, the identity theft protection group, will face a Financial Services Authority (FSA) probe, and has further dented the company’s spiralling share price.
Barclaycard were offering customers CPP card and identity protection cover when they contacted the bank to activate a new card. Which? has long-held concerns over the sale of identity theft insurance.
Chief Executive Peter Vicary Smith said: ‘ID theft insurance is a product that most people will never use yet hundreds of thousands of policies have been sold, which raises serious questions about the sales practices being employed. We wrote to the FSA last year asking it to investigate ID theft insurance sales after several of our members contacted us with concerns about how it was sold to them.’
Barclaycard still selling CPP products through other channels
CPP have denied the decision is related to the FSA probe. Their chief executive Eric Woolley, said: ‘The announcement needs to be put into context,’ he said. ‘Barclaycard wishes to review its “call to confirm” channel. It’s not directly related to our announcement two weeks ago.’
Barclaycard is continuing to sell the company’s card protection and identity theft protection products through other channels though. While CPP ID theft insurance will no longer be available vie Barclaycard’s ‘call to confirm’ line it will be available on the Barclaycard website.
A spokesman for Barclaycard said: ‘We regularly review our processes including the way we issue replacement cards to our cardholders.’
ID theft insurance a Which? ‘top 10 useless financial product’
ID theft insurance has long been a financial product Which? has firmly opposed, so much so that it made our 2010 list of ‘top 10 useless financial products’.
The FSA investigation into CPP is over allegations that it may have overstated the risks of identity theft and, according to CPP’s own figures, only 0.5% of its customers claim on their identity theft policy.
For more details, read the Which? guide and read about , including a checklist on making a complaint to your insurance provider if you think you’ve been mis-sold this product.
Which? Money when you need it
You can follow @WhichMoney on Twitter to keep up-to-date with our Best Rates and Recommended Provider product and service reviews.
Sign up for the latest money news, best rates and recommended providers in your newsletter every Friday.
Or for money-saving tips, and news of how what’s going on in the world of finance affects you, join Melanie Dowding and James Daley for the Which? Money weekly money podcast
For daily consumer news, subscribe to the Which? news RSS feed here. And to find out how we work for you on money issues, visit our personal finance campaigns pages.