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Employment agencies under scrutiny for possible mis-selling of personal accident insurance

It seems as though the government may have another mis-selling scandal on the horizon as the shadow business secretary Chuka Umunna accuses employment agencies of ‘profiteering’ out of mis-sold personal accident insurance.

The government is to investigate the claims but the industry has said such firms are doing nothing wrong or illegal. Mr Umunna said that agencies such as Blue Arrow, Acorn, Taskmaster, Randstad, Meridian and Staffline have been involved in the practice of selling policies to workers which were already covered by their employers.

Mr Umunna, addressing commons, said: “There is even a company- G7 Group- which specialises in putting together these dubious arrangements for agencies.”

According to business secretary Vince Cable, if the practice has been happening, “it would be indefensible, and I think it’s unlawful.”

“I will commit to ensuring that we have a proper enforcement procedure.”

In response to the allegations, the REC’s director of policy said that employment agencies are not doing anything wrong by offering workers the opportunity to purchase accident insurance.

“It’s a product that many other organisations offer to their members, including trade unions,” he said.

“Personal accident cover can be appropriate for workers in high risk sectors such as rail and construction and can also cover them for accidents off-site that would prevent them from working.”



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