While PPI was initially designed to protect consumers when taking out loans and other forms of credit, this acronym has quickly gained connotations of corruption and mistrust after a scandal became apparent. This scandal saw millions of people having potentially been mis-sold PPI and under new FCA regulation, able to claim compensation for this. Whether you’re looking to make a PPI claim online and are looking for more information, or you’re just curious about it all, we’re taking a deeper look at how PPI was mis-sold, below.
What Is PPI?
PPI – Or Payment Protect Insurance – refers to a policy that is designed to protect consumers when taking out loans, credit cards, mortgages and similar. These policies often protected them in the case that they couldn’t meet a repayment due to accident, illness or unemployment that wasn’t their fault, and could be sold alongside loans, or as a separate entity entirely.
PPI was often sold with the following:
- Personal Loans
- Credit Cards
- Mortgages (MPPI)
- Credit For Furniture, Cars etc
- Store Cards
- Business Loans
- Catalogue/Shopping Accounts
However, PPI wasn’t always called PPI. In fact, it was often listed as anything from loan protection cover or credit card repayments cover, to ‘loanguard’ and ‘mortgage care’.
What Counts As ‘Mis-Sold’?
While not every policy was definitely mis-sold, there are a number of criteria that could mean you are entitled to a claim. They are as follows:
- You were sold PPI without your knowledge or consent. You may have also been told that it was compulsory.
- There was a lack of clarity in regards to taking out PPI, particularly if you didn’t truly want it.
- You felt pressured into taking out PPI – This includes being told you weren’t able to take out your loan or credit without PPI alongside.
- There was no explanation as to the criteria for claims, or you were led to believe you were eligible for claims despite being unemployed, retired, self-employed, above the upper-age limit or had a pre-existing medical condition that would’ve prevented a successful claim.
- The commission amount was unfairly high.
Banks and financial institutions earned a lot of money from PPI and this very often contributed to these unfair practices and the mis-selling of these policies. The commission alone could bring in a substantial chunk of the overall income for any business and when customers were unaware that they were being mis-sold a policy, it was incredibly easy to get away with.
Can I Make A Claim?
If you believe you are eligible for a claim, then it may be worth making a complaint to your provider, or to a financial ombudsman service. If your complaint or claim is rejected, a third-party service may be able to help, but it’s important to ensure that you do your full research into not only the service but also whether you truly are eligible or even had a PPI cover in the first place.
If you believe you were mis-sold PPI, you have until the 29th August 2019 under the FCA’s Plevin case. Hopefully, this guide has given you a good starting point, and good luck.