How to claim compensation yourself or if using a claims management company, check they're authorised, your rights and their obligations.
If you’re making a claim for compensation, you have 2 options:
- make the claim yourself
- make the claim through a commercial business like a solicitor or a claims management company (CMC)
Claim compensation yourself
It’s free to claim compensation from financial companies if you have lost money from a mis-sold financial product eg payment protection insurance (PPI).
You can make a claim like this directly without using a CMC. If you aren’t sure how to make the claim, you can get free, impartial advice from consumer organisations.
Deadline for PPI complaints
Free, impartial advice
Many organisations offer impartial advice with no fee or obligation. If you make a successful claim without using a CMC, you’ll keep all the compensation yourself.
Help with financial claims
Money Advice Service: help with mis-sold payment protection insurance (PPI), endowment mortgages and investments
Financial Ombudsman: help with most types of financial complaints, including guidance on how to complain yourself
Financial Services Compensation Scheme: help with compensation for certain claims where a financial firm has gone bust
Which?: mis-sold PPI, mortgages, card protection policies, packaged bank accounts
Help with claims for injuries, employment or housing issues
The Citizens Advice Consumer Service offers help and guidance if you’re considering making a claim for:
If you decide to take legal action to claim compensation for a personal injury, you’ll need legal advice from a solicitor whether you go direct or use a CMC.
In most cases, you can’t get financial help (legal aid) and you’ll often be offered a ‘no win, no fee’ arrangement. If you agree to this and you win your claim, you may still have something to pay.
Using a CMC: your rights as a consumer
Claims management companies (CMCs) are commercial businesses. For a fee, they will handle claims for compensation around:
- mis-sold financial products - eg payment protection insurance (PPI)
- employment matters
- personal injury
- criminal injury
- industrial injury
- housing disrepair - eg neglected, poor quality housing
Authorisation for CMCs
Any business in England and Wales that manages claims must be authorised by the Ministry of Justice’s Claims Management Regulator. There are exceptions for some organisations - eg solicitors, charities and advice agencies.
Being authorised doesn’t mean the Ministry of Justice endorses or recommends the company.
To see if a company is authorised, check the authorised business register.
Fees and CMCs
CMCs charge a fee for their services. Authorised CMCs must give you written information with details of the service they’re offering, their charges and when you’ll be expected to pay them.
You will have to sign a contract with the CMC (if you haven’t signed then you haven’t made a contract). You have 14 days from signing your contract to cancel it without being charged.
If you hand over any money up front, you can ask for it back within the 14 days. If you cancel after the cooling off period, you will have to pay a fee. This should be reasonable and reflect the work carried out on your claim.
Companies often work on a ‘no win, no fee’ deal. In PPI claims, they typically charge about 25% of the value of the claim plus VAT.
If you don’t win, you may still have to pay expenses or other costs to the CMC.
What to expect from a CMC
To be authorised, CMCs must stick to strict rules when dealing with consumers.
They must not:
- send you emails or texts (unless you’ve agreed to receive them)
- make marketing calls if you have told them that you don’t want to receive them or if you’ve registered your number with the Telephone Preference Service
- approach you in person
- use any form of high-pressure selling such as asking for on-the-spot decisions
- give you clear written information about their service (including fees and costs) before you agree a contract
- get your signature before taking any money or starting a claim
- tell you clearly about ombudsman schemes or any other official ways you can claim
- offer a 14-day cooling off period when you can cancel your contract without being charged
- clearly explain how to complain if you’re unhappy with the service they provide
Make a complaint
If you’re not happy with the service you receive, find out how to complain about a claims management company.
If your CMC is no longer authorised
If a CMC’s authorisation is suspended, cancelled or surrendered, it must stop offering services to new and existing clients.
If your claim has gone to the Financial Ombudsman Service, they will contact you in due course.
If your claim has gone to a solicitor, bank or other financial services provider, get in touch and ask them to deal directly with you in future. Then inform the CMC in writing of what you are doing.
If you can’t get a refund from the CMC itself, you have a number of options depending on how you’ve paid any fees.
|Paid by||Refund option||Advice from Which?|
|credit card||contact your credit card provider for advice||Making a claim against credit card provider|
|debit card||contact your debit card provider for advice about ‘charge back’ scheme||Making a claim against debit card provider|
|cash, cheque or banker’s draft||contact the CMC direct||If a company goes bust|