When purchasing a mobile telephone, TV or appliances, for example, you often receive an offer to buy insurance for the newly purchased item. FI will now review whether so-called product insurances create unnecessary costs for customers without providing extra protection.
Insurance companies must treat each policyholder fairly and ensure that offered products meet their needs. Companies that sell insurance, like many electronics retail chains, must also demonstrate a duty of care towards consumers and only offer goods and services that are needed.
Today, it is normal to receive insurance offers every time you buy certain types of goods, most often electronics or appliances, despite the cost of such items already being covered by home insurance policies or manufacturers' product warranties if they were to break.
Therefore, there is a risk that many people are being offered an insurance that they do not need and that simply becomes an unnecessary expense. FI will therefore review a number of insurance companies that are prominent on this market to gain an understanding of how many consumers have actually used their insurance and whether a reasonable portion of the paid premiums are used to pay for broken products.
"It is important that people do not pay for protection they do not need. This is what we are going to find out," says Åsa Larson, the executive director of the Insurance section at FI.
The review is expected to be completed by the end of the year.