An Advertising Feature
In the past five years there has been a significant rise in the number of customers making official complaints regarding their bank, building society or credit card company. Many of these complaints relate to the sale of payment protection cover. Sometimes known as PPI or loan insurance, payment protection is sold with credit cards, loans and mortgages. It is meant to protect a customer if they cannot work due to accident, sickness or involuntary unemployment by stepping in to take over their repayments. Unfortunately, PPI doesn’t always provide the level of cover you may expect, can be very expensive and has often been mis-sold.
One of the major reasons customers choose to make a payment protection insurance claim is because of the high number of exemptions attached to many payment protection policies. Exemptions are things that the insurance does not cover and usually includes pre-existing medical conditions as well as common ailments such as back pain, depression and stress. In most cases customers do not find out how many exemptions their policy has until they try to use it. One survey conducted by the Competition Commission, in 2008, found that just 15% of customers who tried to use their loan PPI policy received a payout – for credit card PPI the figure was just 11%!
If the terms, conditions and exemptions of your policy were not clearly explained this may be considered grounds for a claim for mis-selling and you may be entitled to make a PPI reclaim.
Another criticism of payment protection cover is the high cost of policies. Loan PPI usually costs between 13%-25% of the loan value. The cost is added to the loan and will incur interest meaning your debt and repayment period may be considerably increased. If your lender did not fully explain the cost of your PPI this could amount to mis-selling and you may be able to make a claim.
Although a failure to explain the terms and costs of a payment protection policy can be considered mis-selling there are many other circumstances in which a policy may be regarded as mis-sold. If you were told the policy was compulsory or that taking out the cover would improve your chances of being given credit you were given the wrong information and could make a claim. Likewise, if you felt pressured into taking out a policy or it was added without your knowledge.
One of the most significant forms of mis-selling is where policies were sold to customers who either didn’t need or couldn’t use them. If, for example, you have cover in place elsewhere or were in secure employment with full sick pay entitlement, you may not have needed the cover and it probably should not have been offered to you. In the most severe cases customers were sold policies they were ineligible to use. A common example here is customers over the age of sixty-five who usually cannot be covered and customers who were retired, unemployed or in full time education and who obviously wouldn’t need to be covered for loss of employment! If you think you were mis-sold a policy that you didn’t need or were ineligible to use, you are entitled to make a claim for compensation.
You may also be able to make a claim if you have paid unfair credit card charges in the past. A 2006 investigation by the Office of Fair Trading found that bank charges applied by some banks and credit card companies for late payments and over the limit fees were unfairly high. Some banks were found to have applied charges of up to £35 claiming they were necessary to cover costs, but the Office of Fair Trading found that a maximum charge of £12 should be applied for late payment and over the limit fees. As a result of the investigation, most lenders have lowered their charges. The investigation has also opened the door for customers who have paid unfair fees in the past to start claiming back bank charges.
If you have paid unfair credit card fees or been mis-sold payment protection cover you have the right to make a claim. More than a million unhappy customers have already registered a complaint and many have received thousands of pounds in compensation. You have the option to speak to an advisor at The PPI Claim Company to discuss whether you have a case for mis sold ppi.