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Beware cold callers selling dubious 'home appliance insurance'
Unscrupulous companies are cold calling vulnerable people and tricking them into paying for warranty policies for their household appliances.
Our inbox has been inundated with stories from people who've been misled into handing over bank details, with the elderly being heavily targeted.
Nuisance phone calls, pressure selling and fraudulent tactics are being used to sell policies that might not even exist.
Payments are often set up as direct debits and can total hundreds of pounds a month.
Yet the contracts we've seen contain generic wording, giving little detail about what's actually being paid for and casting doubt on what you'd get if you tried to use your appliance cover.
Here we investigate this growing con and the impact it's having on vulnerable people.
Scale of the problem is 'shocking'
Emma Jones told us that after her partner's elderly father passed away, they discovered he'd been paying dozens of direct debits for appliance cover. In the month before his death alone, payments totalled almost £1,000.
'The scale of the payments going out shocked us,' she said. He had several policies covering the same items.
'I looked up some companies and saw bad reviews and comments about cold calling. I don't know how these people sleep at night.'
While Emma and her partner were at his father's home sorting through his belongings, they received five calls to his landline selling the same cover in just one afternoon.
How the selling unfolds
While many cold calls are trying to sell a new policy, many claim your existing cover is expiring and you need to renew, regardless of whether you had cover in the first place.
They often pretend to be legitimate insurers Domestic & General (D&G), with which thousands of people have cover.
Susie Brant from London thought she was renewing her washing machine cover with D&G when she received a phone call saying her cover had ended. 'The caller said he was from my insurance company.
'He was persuasive and offered a better deal, but it was all lies,' she said.
Susie later realised she'd paid a completely different company called Repair & Assure. She was also charged £225 upfront for a three year policy when she had only agreed to paying £6 per month.
Fortunately, she was able to get a refund.
We asked Repair & Assure about what happened in Susie's case, and others.
It said: 'Repair & Assure Ltd do not cold call under any circumstances. Repair & Assure Ltd are clear at all times who we are and have multiple procedures in place to prevent confusion.'
It also told us it is not an insurance provider so it would not be beneficial to compare the company to other insurance providers.
- Find out more: the rise of phone scams and how to spot one
Victims failed by call blocking
All the calls we've heard about have been made to landline phones.
Worryingly, we've been told these calls are slipping through call-blocking services, despite some landline customers paying up to £5 a month to stop receiving unsolicited calls.
Ben Marshall has set up various call blocking services for his 91-year old mother, Sandrine, who has dementia.
Yet cold callers were still able to get in touch with her and persuade her to hand over her bank details four times for similar appliance cover policies, over a six month period.
'I think mum was repeatedly targeted after telling a call operator she suffered from memory loss.' Ben told us. 'I've had to buy her a phone that only allows calls from a list of approved numbers of family and friends because the call blockers clearly weren't working.'
Who is behind the calls?
None of the companies we've investigated have one permanent address they operate from. The listed office addresses are almost always rented mailboxes.
Curiously, we found several companies brought to our attention are registered at addresses in Brighton and Hove - all within a 10 mile radius of each other.
Again, all of these addresses are unstaffed, rented mailboxes.
We told Trading Standards in Brighton & Hove about these connections and asked them for comment, but we didn't get a response.
- Find out more: how to block nuisance calls
Tackling the problem
We've passed on our findings to the industry regulator, the Financial Conduct Authority (FCA).
The FCA said it's working with Trading Standards to tackle the issue, although it was unable to provide any details of recent action it had taken.
Reputable companies never call customers out of the blue asking for payment. As with all cold calls, check the details before you commit.
Most companies we've looked into aren't registered with the FCA. This is a red flag because it means a company may not be playing by the regulator's rules.
The FCA advises to choose cover from registered companies. Ask the caller for their Firm Reference Number and check it online on the FCA website.
Do you really need home appliance insurance?
Ultimately, we don't think extended home appliance cover is worth having anyway.
Your home or contents insurance will cover the most common problems you might have with your washing machine, dishwasher, oven or other appliances.
You'll also be covered by the standard manufacturer's warranty that comes with most expensive appliances when you buy them, which can last for over 10 years in some cases.
Some bank accounts also offer breakdown protection, so it's worth checking what benefits you already have.
What you can do if you've been mis-sold a policy
If you think you've been mis-sold a policy, or are having trouble cancelling one, contact your bank for advice.
You should be able to claim your money back under the Direct Debit Guarantee, or under Section 75 if you paid over £100 using a credit card.
If you've paid out using a debit card, you can ask your bank to refund you through its chargeback procedure.
