PPI Cover - the basics
- PPI stands for Payment Protection Insurance
- PPI is taken out as protection when applying for a loan, mortgage, credit card, store card and many other types of finance
- PPI is designed to cover the policyholder should they find themselves unable to meet finance repayments as they have been made redundant or if they are unable to work because of accident, illness or injury
- Research by the Financial Services Authority (FSA) has found many cases where PPI has been mis-sold
How did PPI get mis-sold?
FSA research shows the majority of cases where PPI had been mis-sold can be defined to one key point; staff at financial providers were not receiving adequate training on the product they were selling.
The following other key points were noted by the FSA:
- Firms were found not to take reasonable steps to ensure customers did not purchase policies on which they could not make a claim or which only provided very limited cover
- Advice on PPI was likely to be poor as many firms did not have systems in place to assess whether the insurance was suitable for a customer
- It was found when PPI was sold via the telephone, the policy couldn't be explained in great depth and sufficient information on exclusions wasn't given
- There were inadequate controls in place for non-advised sales, around half of the firms selling on a non-advised basis did not have adequate systems to stop their staff giving advice or were providing information that amounted to giving advice
- Compliance monitoring was variable and in some cases very poor
- There were cases of firms where the level and structure of inducements and targets for sales staff could encourage mis-selling.
Do you need PPI Cover?
PPI cover is only needed by those who don't already have suitable cover in place to protect their debts. Suitable cover could be an illness or redundancy package offered through your employer or Income Protection insurance. If you don't have alternative cover, it is worth taking out PPI Cover to protect your debts, in case you cannot pay them due to being unable to work.
When properly structured, explained and sold, PPI Cover can provide worthwhile protection for customers against unexpected changes in their personal circumstances
Do you have a claim for mis-sold PPI Cover?
If you have a mortgage, loan, credit card, store card or have obtained any other finance in the last 10 years, there is already a good chance you can make a claim for mis-sold PPI cover.
Mis-sold PPI cover claims are more common in the UK than many people realise. Around 90% of the UK public have a credit card or a loan and there is a chance all of these people could have a claim for mis-sold PPI cover.
Are you unsure whether you have PPI cover? If you have a credit card you can establish if you have PPI cover by checking your monthly statements, as it should be stated. If you have a personal loan, mortgage or any other finance, you should check the original agreement but it might not be so obvious. If in doubt contact your lender to find out if you have a policy.
You may be eligible to claim back your PPI payments if any of the following cases apply to you:
- You didn't ask for a PPI cover, but it was added anyway
- It was implied PPI was compulsory or that by taking it, you would have a better chance of obtaining finance
- You wasn't informed payment protection was optional or that cheaper cover could be purchased elsewhere
- You wasn't made aware of the policy exclusions, for example: the terms for cancelling the cover or significant exclusions such as stress and back problems
- If you were unemployed, retired or self-employed when you took out the cover, you wouldn't be able to make a valid insurance claim
- If you had a medical problem or illness at the time of taking out the cover that could have kept you from working, PPI is unsuitable insurance cover in this case
- If you were sold a Single Premium policy, you should at least be able to get a refund by cancelling the PPI cover
- Many policies have an upper age limit, usually 65 or 70. You cannot claim if you were older than this at the time of taking out the PPI policy
- You already have alternative cover that could insure your repayments such as income protection or an employer illness or redundancy package, but were not asked about this, you could claim
- If you bought PPI to cover a long term loan, there is a chance that the insurance will run out before the loan is repaid. Many PPI policies will not cover the full loan term; the seller should have explained this limitation. If they didn't, you can claim
Reclaiming payments made for PPI cover
Do you have a claim for mis-sold PPI cover? iSmart can help you to think smarter and recover any payments you have made.
Apply online and our specialist team will immediately start the process for reclaiming your mis-sold PPI cover. Or if you have any further questions or require additional information about mis-sold PPI, you can speak to one of our specialist team on 0800 043 3025
No upfront fees
It's time to get smart and claim back what is potentially yours. If you have taken out a loan in the last 10 years...
Regulated by the Ministry of Justice in respect of claims management activities. Authorisation number CRM2506. View at www.claimsregulation.gov.uk
* that's the average amount of compensation awarded to an i-Smart PPI claims customer.