I've been mis-sold credit card insurance, can I get compensation?

If you think you've been mis-sold card fraud insurance, read on to find out what to do next, as you may be eligible for compensation.

Mis-sold card insurance

The Financial Conduct Authority (FCA) has announced a new compensation scheme for customers who have been mis-sold insurance policies to protect against card fraud.

The FCA said that some elements of these fraud insurance packages - sold between 14 January 2005 and August 2013 - were unnecessary because the card providers were already legally required to offer this protection.

Following the FCA investigation, the banks and card providers involved have agreed to pay compensation through a dedicated compensation scheme.

Claim deadline: 18 March 2016

If you received a letter and compensation claim form from AI Scheme Limited about a card security product and you wish to claim compensation, you must return your completed compensation claim form no later than 18 March 2016.

There is an extended claim period until 19 September 2016 for 'exceptional cases'. For example, if you've been out of the country for a long period of time, the deadline may be extended for you.

Am I eligible for compensation?

Approximately two million people who brought a card security product will receive a letter from AI Scheme Limited about the compensation scheme.

The scheme will cover customers who have products provided by Affinion International Limited and distributed by 11 banks.

You may be entitled to compensation if you bought one of the following products from a bank, credit card provider or Affinion International Limited:

  • Card Protection,
  • Sentinel
  • Sentinel Gold
  • Sentinel Protection
  • Sentinel Excel
  • Safe and Secure Plus

The institutions who have agreed to pay compensation include:

  • AIB Group (UK) Plc trading as First Trust Bank in Northern Ireland and Allied Irish Bank (GB) in Great Britain
  • Barclays Bank Plc
  • Capital One (Europe) Plc
  • Clydesdale Bank PLC
  • HSBC Bank Plc
  • Lloyds Bank Plc
  • Northern Bank Limited trading as Danske Bank
  • Santander UK Plc
  • Tesco Personal Finance plc
  • The Co-operative Bank Plc
  • The Royal Bank of Scotland Plc

What is AI Scheme Limited?

AI Scheme Limited is a company set up to refund customers of Affinion and the 11 banks listed above.

But we always advise you to be cautious. If you are unsure whether the letter you have received is genuine, you should check with AI Scheme or the FCA for further information.

What do I need to do?

You don’t have to do anything at this stage.

If you’re an eligible card security product holder, you should receive a letter from AI Scheme Limited.

This letter will explain how the compensation scheme will work and what you have to do next.

You should read the letter from AI Scheme Limited and keep it in a safe place as you may need to refer to it again.

AI Scheme

If you think you are eligible for compensation look out for a letter from AI Scheme.

You should receive a letter by the end of February if you are eligible for compensation.

How AI Scheme compensation works

If the scheme is approved, AI Scheme Ltd expects compensation to be paid from the second half of 2015.

The following steps will take place from now. These timings are approximate.

Eligible customers will receive a letter from AI Scheme from late January 2015 with more information about the compensation scheme.

Those customers will get a second letter in April or May 2015 asking them to vote on whether they want the compensation scheme to go ahead.

In order for the compensation scheme to go ahead, a majority must vote in favour of it. But you don’t have to vote.

Even if you don’t vote - or vote against the compensation scheme - you will still be able to claim compensation if the scheme is passed by a majority.

How should I vote?

The FCA has recommended that consumers vote in favour of the scheme.    

If a majority of customers vote in favour of the compensation scheme the High Court will be asked to approve it.

If the scheme is approved by the High Court, a third letter will be sent by AI Scheme Limited to eligible customers in August and September 2015 to ask whether they want to claim compensation.

This letter will include a compensation claim form that has to be completed, signed and returned before the specified deadline, in order for a successful compensation claim to be made.

I haven’t been contacted

If you bought a card security product before 2005 or as part of a packaged account then you won’t be eligible for compensation under the AI scheme.

You can still complain to your bank or the insurance provider to pursue compensation directly. 

If you are unsure of your insurance provider then you should contact the bank who sold you the policy.

If you complain and are unhappy with the outcome, then you can take your case to the Financial Ombudsman Service.

The first letters will be sent out between 27 January 2015 and 23 February 2015 – we recommend waiting at least one week after 23 February 2015 to see if you receive a letter.

If you think you're eligible for compensation but don’t receive a letter from AI scheme you can contact AI scheme Limited

My claim was mis-handled

If you believe your compensation claim was not handled correctly under the AI Scheme, you can complain to the Financial Ombudsman Service on this point if you're dissatisfied with the decisions of the AI Scheme Administrator and then the Scheme Adjudicator.

More information

If you want to find out more, please visit:

'We deserve better banks'

Join our campaign
& help us reach 100,000 signatures

Banks could do so much more to help you get the most out of your money. The big players in the market need to up their game, and the competition inquiry must ensure banks are held to account for how they treat their customers.

Find out more about Better banks on Which? Campaigns

Thank you for signing our campaign

Help us spread the word by sharing our campaign


Please tell us what you think of the Which? Consumer Rights website.

Your feedback is vital in helping us improve this site. All data will be treated confidentially. This survey will take approximately 5 minutes to complete.

Please take our survey so we can improve our website for you and others like you.