Insurance and warranty schemes

Find out how insurance and warranty schemes work, how to tell if it's a scam and what to do if you are scammed.

If you buy or own a product like a mobile phone, satellite TV box or home appliance, you might consider insuring it in case it gets damaged or lost. 

This sort of insurance should cover you for the repair or replacement of the product, with parts and labour costs often included.

However, some fraudulent firms take payments from customers but don’t arrange the insurance as agreed. This could leave you with little or no protection. Some other companies contact people to sell, promote or advise on insurance without our authorisation. 

It's important to remember that if you deal with an unauthorised firm you won't be able to make a complaint to the Financial Ombudsman Service or have access to the Financial Services Compensation Scheme (FSCS) if things go wrong.

Find out how to tell if an insurance and warranty scheme is a scam.

How insurance and warranty schemes work

You may be cold-called with an offer of insurance for an item like a mobile phone, satellite TV equipment, or your home appliances. 

The call will usually come soon after you buy the product or start a new contract (though existing customers may also be approached) and you may feel pressured to act quickly.

The cover is often described as a ‘warranty’ but is actually an insurance contract. 

Arranging and providing insurance contracts is a regulated activity, which means the company offering it to you must be authorised by us.

The caller may claim they are linked to the store or company you bought the product from, or your mobile phone of satellite TV provider. However, if the firm is unauthorised, this is highly unlikely.

Unfortunately, you may only find out you do not have the insurance you agreed to, when a claim is rejected.

Protect yourself

Remember: if it sounds too good to be true, it probably is.

We strongly advise that you only deal with financial services firms that are authorised by us. You can check the Financial Services Register to make sure they are.

To confirm the identity of an authorised firm, ask for their 'firm reference number' (FRN) and contact details. You should always call them back on the switchboard number given on the FS Register. 

If there are no contact details on the FS Register, or the firm claims they are out of date, contact our Consumer Helpline on 0800 111 6768.

You can also search our list of unauthorised firms to avoid doing business with, although their names are likely to change regularly.

We add new names to this list as soon as possible, but if the firm that approached you doesn't appear on our list, don't assume it's legitimate – it may not have been reported to us yet.

You should check the details on your insurance policy to ensure they are correct.

If you think you've been scammed

You can report an unauthorised insurance firm or broker by completing our online form or contacting our Consumer Helpline on 0800 111 6768.

Please provide as much information as you can about the company involved, including their contact details and FRN. The more information we have, the better our chances of assessing whether the firm should be authorised by us and then taking action.

We are working together with Trading Standards to combat unauthorised firms involved in schemes selling, promoting or advising on insurance, so you can also contact your local Trading Standards to make a complaint.

Page updates

19/08/2021: Information changed Money Advice Service to MoneyHelper