Payment Protection Insurance Total Revealed
It has been revealed that the claims total for Payment Protection Insurance (PPI) has hit 320 million and continues to increase
. After the Judicial Review in April 2011, an increasing number of people have been coming aware of their missold PPI situations and as such have been seeking ways to gain compensation and repayments.
The PPI misselling scandal has been hugely highlighted by the media, which in turn has led to millions of individuals questioning their bank and discovering that they too have been victims of the moneymaking scheme. For some, PPI was sold to them as a compulsory product to gain a credit agreement, whilst others did not even realise that they had been sold a new protection product. In many cases, insurance was vastly expensive but also invalid, not allowing individuals to actually make a claim even if they needed to.
Payment Protection Insurance on loans has been proven as particularly over-priced. Sometimes this kind of insurances was named as LPI or Loanguard insurance and was designed to protect cunsumers who would be unable to keep up repayments of loans, credit cards and mortgages in times of sickness or after losing their job. Whilst such insurance can be useful, many people were sold Single Premium Policy insurance that was often vastly expensive. On an 11,000 unsecured loan, insurance could be up to 47 per cent on top of the interest, resulting in people possibly paying more than 6,000 for a loan that they may never make a claim on. The problem occured when the PPI was missold at the point of sale when the sales staff sold policies without performing due diligence into the circumstances of the consumer and the cover was overpriced and many cases totally ineffective.
However, whilst the injustice has been carried out for over a decade, 2011's review highlighted the issue and found that financial institutions were legally obliged to pay back payments to customers in addition to offering compensation packages. For those who have applied for credit cards, loans, car finance or mortgages in the past ten years with UK banks, a claim of all payments plus eight per cent compensation could be received; a sum which could exceed thousands of pounds. Moreover, with Britain expecting a double dip recession, taking the time to unveil missold insurance and claim money back could offer a welcome financial sum to make the current economic climate a little easier to bear.
Anyone who has taken out a loan, credit card and/or mortgage are advised to take a look at their credit agreement to find out if they have been missold PPI. It does not matter if the financial agreement has completed as the consumer could still have been missold and could seek financial redress. In the case that it was, individuals could look forward to a relatively large compensation and repayment package.
by: Colin Hartness
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