PPI (payment protection insurance) is a type of cover that was a popular form of protection for finance agreements such as loans, credit cards, mortgages, store cards, catalogues, car finance agreements and overdrafts. PPI was designed to cover repayments of the finance agreement if you became sick, unemployed and many other circumstances which would make it difficult for the borrowers to keep up with repayments.
PPI, if sold for the right reasons for the benefit of the consumer would have been a good product, but due to the many mis-selling factors by brokers and banking staff, the product has become notorious for being one of the UK’s biggest mis-selling scandals in the baking industry. Many brokers and banking staff were urged to upsell PPI to people that didn’t require or need it, but that is just one of many reasons that PPI was mis-sold.
The FCA (Financial Conduct Authority) recently announced another damaging reason how PPI was mis-sold. A lady by the name of Mrs S.Plevin won a Supreme Court battle against Paragon Personal Finance Limited in which it was shown that not only was PPI mis-sold but also that the bank/broker did not disclose to the consumer the amount of commission they would receive in selling you the PPI policy. This commission the bank/broker would receive is the most likely reason why PPI was being pushed on so many consumers throughout the UK and why there is now such a PPI mis-selling scandal.
Industry whistle-blowers, such as Mr Cliff Darcy, confirmed the following in an interview with the BBC: “My colleagues and I knew there was no question that we were working in a corrupt industry, making vast profits from consumer innumeracy.” This goes to show that the selling of PPI was a very lucrative industry and that the banks/brokers were making huge profits off the back of uninformed consumers, in some cases deceptively.
An interview with Bill Michael, head of the UK financial services at KPMG echoed a similar statement: “Product became king. It was more important than customers, who were force fed by the banks. It gathered momentum over time until entire remuneration and reward models were built around how many products were sold without always testing their appropriateness.” (source)
With the PPI mis-selling scandal bursting onto the scene, many claims management companies have been set up to assist the customers in reclaiming their mis-sold PPI. Many of these companies have been tarnished with the same brush for making unsolicited calls (cold calling) and the industry has received “bad press”, but there are many companies that conduct themselves honestly and legally such as My Claim Solved Ltd, we do not cold call!
A claims management company will take a percentage of the money that is reclaimed in compensation, whereas if you make the claim yourself you will receive the entire compensation. Customers who have been mis-sold PPI have a choice, if they want to use a claims management company such as ourselves, we will manage the claim from start to finish, we will provide a service, expertise and industry knowledge to help make sure you win the full amount you are entitled to, please use the enquiry form at the top of this page if you want to use our services.
- Was your PPI cover shorter than the term of your finance agreement and was you made aware that you would have a period of time towards the end of your agreement with no PPI cover?
- If it was not explained to you that there would be a period of time where you were unprotected by PPI, you could potentially have been mis-sold.
- Were you given the impression that your finance agreement must have a PPI policy and that is was compulsory?
- In some cases, a PPI policy was compulsory for a finance agreement, but you should have been made aware that you could shop around OR if you already had pre-existing PPI cover elsewhere, you should not have been sold another PPI policy rendering one of the policies useless.
- Were you made aware that a portion of your PPI premiums could potentially be paid as a commission?
- You would be due a PPI refund if over 50% of your PPI premiums were paid in commission to the bank/broker.
- Were you informed about your rights of cancelling your PPI policy?
- It should have been explained to you that you had the right to cancel your PPI policy within the cooling off period.
- Were you told about any exclusions or circumstances when you would not be eligible to make a claim?
- You may have been mis-sold your PPI policy if you were not made aware at the point of sale of any circumstances in which you could not make a claim.
- At the point of sale, was the total cost of the PPI policy clearly explained to you?
- If the total cost of the PPI policy was not covered at the point of sale, this would be considered a big mis-selling factor.
- If your PPI policy had an upper age limit, were you older than that upper limit?
- You would not have been covered by your PPI policy if you exceeded this upper age limit.
- At the point of sale of your PPI policy, were you self-employed, unemployed or retired?
- Your PPI policy may have been useless if you were self-employed, unemployed or retired at the time it was sold to you.
- When you were sold your PPI policy, did you have a pre-existing medical condition?
- Throughout the term of your PPI policy, if you were ever unable to work, you may not of been covered by your PPI policy if you had a pre-existing medical condition at the point of sale.
- Were you made to feel pressured into purchasing the PPI policy?
- No pressure or hard selling should have been put upon you with regards to the sale of PPI, a simple assessment of your personal circumstances to decide if PPI was of any benefit to you would suffice.
- Did you know that PPI has been added to your finance agreement?
- PPI may have been added to your agreement without your consent or by using an opt-out box which was not obvious to you at the point of sale.
- Did the bank/broker enquire if you had any payment protection insurance elsewhere that would of covered your repayments?
- Before selling you an additional PPI policy that would render the other obsolete, the bank/broker should of enquired to any other form of PPI you already had.
Have you had a credit card, some form of a loan, store card, overdraft, mortgage, car finance or catalogue account and you haven’t made a PPI claim against that product before, you could have been mis-sold PPI! The PPI deadline to make a claim is just around the corner, August 2019, act today!
You can start your PPI claim today, but first you need to decide if you want to use a claims management company like ourselves (My Claim Solved Ltd) or if you want to start your PPI claim yourself, both options have their pros and cons.
Start your PPI claim yourself
You can start your PPI claim yourself today, with a bit of research and time spent writing a complaint letter to your provider stating the reasons for the complaint. Once the provider has acknowledged your complaint, they will usually respond within 8 weeks with a decision.
If you receive a rejection letter for your PPI complaint, you can take your complaint to the Financial Ombudsman Service who will consider your complaint and determine if the rejection from the provider is valid or not. If they decide you should be paid compensation, the provider must accept this decision and pay the PPI compensation that Financial Ombudsman Service suggested.
It’s not just a matter of having the time to make a PPI complaint yourself but also having the expertise to be able to identify if your provider is using stone walling tactics to delay or even reject your PPI complaint. With all this considered, if you are willing to put in the effort, the research and to remain vigilant, you will save yourself the fees associated with using a claims management company.
Using a claims management company
The quickest and easiest method of starting a PPI claim is by using a claims management company (CMC). A CMC will deal with all the correspondence with your provider and Financial Ombudsman Service and using their expertise, will do everything in their power to get the best possible outcome for you. It is worth noting that because a claims management company gets paid when you receive your PPI refund, you can rest assured that everything that can be done is being done to the best of their ability. My Claim Solved Ltd has vast experience dealing with PPI complaints and the banks, what tactics are used to delay and sometimes avoid paying customers what is rightfully theirs.
Banks and brokers have rejected many complaints and in some cases but not all, unjustly rejected PPI complaints when a customer is rightfully due compensation. This can result in more distress and wasted time for customers wanting to submit a PPI claim themselves, but as mentioned previously, if you are willing to spend time and effort making the claim yourself, you will save on the fees we charge.
If you do choose to use the PPI claim services that My Claim Solved Ltd provide, rest assured that we will not give up the fight easily, our experience and knowledge we have in dealing with the banks will give your claim the best opportunity available in seeking compensation.
How far back can you claim PPI?
PPI has been around just before 1970, although it wasn’t being sold in large amounts until the early 1980s. We must remember that PPI is necessarily a bad product, determine if you are due a PPI refund will come down to the fact if it has been mis-sold to you either deceptively or negligently.
In April 2011, stricter guidance came into play in the sale of PPI, but prior to this PPI was sold alongside a large number of different finance agreements such as Loans, Credit Cards, Store Cards, Mortgages, Car Finance and much more.
On a final note, whether you make a PPI claim yourself or if use a claims management company, stay vigilant! Don’t presume that the organisation that originally mis-sold you PPI would treat your claim fairly.
In August 2016, the FCA (Financial Conduct Authority) published a proposal regarding a deadline they were planning to impose on consumers being able to make a PPI complaint. On 2nd March 2017, the date was announced for the final deadline on which PPI claims could be submitted to be investigated. This date being 29th August 2019.
With an estimated total of around 52-64 million policies being sold to around 30 million consumers(source), and the amount paid out from banks since January 2011 (accurate as of the FCA statistics 16/05/2018 source) being around the £30.4 BILLION mark. It would seem there is plenty more to be paid out which leads us to the question, why has a deadline been put in place? Andrew Bailey, Chief Executive of the FCA stated: "Putting in place a deadline and campaign will mean people who were potentially mis-sold PPI will be prompted to take action rather than put it off. We believe that two years is a reasonable time for consumers to decide whether they wish to make a complaint. We have carefully considered the feedback we received and we still believe that introducing a deadline for PPI complaints and a communications campaign warning of the deadline will benefit consumers." (source)
PPI is one of, if not the BIGGEST scandal involving mis-selling that the UK has ever seen and it has massively overshadowed the bank charge claims from 2007/8. If the banks had followed orders, investigated and compensated the clients who were mis-sold themselves then there would be no need for a deadline to be announced. This obviously hasn't happened. Not following this order is obviously in their best interest, unless every single consumer who was mis-sold their PPI policy makes a claim, which will unfortunately never happen.
With the PPI claim deadline rapidly approaching, there is no better time to check if you have been mis-sold a Payment Protection insurance (PPI) policy than now. It is better to be checked, and (though unlikely) return nothing, than to not be checked and miss the deadline, therefore never knowing if you were mis-sold and due compensation.
In order to work out how a PPI refund is calculated, there are some complex calculations that need to be undertaken. You will need various bits of information such as the interest rate and amount borrowed etc.
The "amount borrowed" is a generic term, but is used on here to represent the amount taken on a loan, or amount owed on a credit card at the end of each month. The way that the calculations are worked also depends on the circumstances of the credit, for instance, whether the PPI policy cost was added on to the amount borrowed, or whether it was kept separate. If it was added on to the amount borrowed on a loan, this is what is called "front loading" and can significantly increase the amount of compensation you are due.
The reason that a "front loaded" policy will increase the amount of compensation you are due is because, for example: If you were to take out a loan of £5,000 from the bank over 5 years and the PPI policy was going to cost £1,000, the bank would add the £1,000 cost of the PPI policy onto the cost of your loan, essentially making it a £6,000 loan. You then have their interest rates to take into account which will be on £6,000 instead of the £5,000 you actually wanted to borrow. Any PPI refund should be broken down into the following: The cost of the PPI policy, the amount of extra interest you paid as a result of the PPI policy being front loaded, 8% statutory interest from when the first payment was made, through to the current day. Once you have this information, the final PPI compensation calculation would be worked out by adding these amounts together to give you your total amount of compensation due.
Obviously it can seem quite daunting having to work all of this out yourself, which is one of many reasons that most consumers prefer to use a regulated Claims Management Company to handle their claims for them. At least if the only fees you are paying are percentage of compensation, you know they will ensure that you receive as much as possible. They will therefore ensure that all calculations are checked thoroughly.