Payment Protection Insurance
If you have a loan, credit card or mortgage then it is probable you have or at least were offered payment protection insurance. Payment protection insurance, sometimes known as PPI, is a type of insurance that covers a borrower’s repayments if they cannot work as a result of involuntary unemployment. For many years payment protection was incredibly popular, but it has fallen out of favour in recent years after it was revealed that it has been widely mis-sold.
The mis-selling revelation came as a result of investigations by the Office of Fair Trading and the Financial Service Authority. Several major high street lenders were fined and this opened the doors for customers who had been mis-sold cover to pursue a claim. Thus far, more than 1.5 million customers have made complaints with figures increasing year-on-year.
Part of the reason why the mis-selling scandal has grown to such a size is that there is actually a large number of ways in which a payment protection insurance policy can be mis-sold. This means complaints are the result of a large number of different failures grouped together.
Very broadly speaking, the issue of mis-selling can be grouped into two different failures.
1. The customer was given incorrect or misleading information
This can include instances where the customer is given only selective information about the cover, for example where only positive aspects are emphasised, as well as where customers were given completely incorrect information, for example that the cover is compulsory or will improve their chance of being approved for credit.
2. The customer is sold a policy that is unsuitable for their needs
The other side of mis-selling is where a customer is sold a policy that is unsuitable for their needs and should not have been sold to them. Examples of this may include a customer who is unemployed and, therefore, has no need of cover for loss of employment or a customer with a pre-existing medical condition that may make them ineligible for cover.
If you have been mis-sold payment protection insurance, you can start your claim today by completing our online claim form.