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What is PPI (Payment Protection Insurance)?

what is PPI - payment protection insurance

PPI stands for Payment Protection Insurance and is an insurance policy that has been sold alongside loans, credit cards, car finance and mortgages.

In simple terms it is an insurance policy that loan and finance companies offered customers to cover themselves should they not be able to keep up repayments due to injury, illness or unemployment.

Policies on credit agreements were sold by banks, lenders and mortgage companies and go back more than 20 years.

Can anyone claim back PPI?

There are many reasons that you may be able to make a claim against a suspected mis-sold PPI policy and can include:

  • Your PPI cover wasn’t adequately explained to you
  • Your policy was over-priced
  • The policy was sold to you, but at the time you already had sufficient cover in place
  • It was sold to you as compulsory in order for you to get the loan
  • The policy was hidden inside your loan without you being aware of it
  • The policy wasn’t ‘fit for purpose’ or couldn’t be used to claim against due to your age, employment or illness circumstances

How and why was I mis-sold PPI?

Lets look at the reasons and questions you may have regarding your concerns about a suspected mis-sold PPI Policy in more detail.

Often at the point of sale the policies were not adequately explained, this is an important area which may trigger a claim as PPI policies are notoriously specific about what they will cover, which is why a potential policy holder should always be questioned at the point of sale to make sure their situation doesn’t invalidate their insurance should a claim arise.  If the PPI sales person didn’t explain the policy to the customer and check their circumstances met the requirements then this could be deemed mis-selling.

In most cases PPI policies were sold alongside loans and credit cards at the point of agreement, meaning that customers didn’t realise they could look at alternative policy quotes and therefore were inclined to go with the lenders cover.  Independent policies available on the open market may have been cheaper and that option should have been made clear and this may resulted in them getting a better deal. Some lenders made the lenders feel forced into taking out PPI in order to get the loan they needed and taking  advantage of this situation led them to price  the policies at any level they wished.

Sales persons who sold policies should have asked lenders if adequate insurance cover was already in place to cover the loan repayments. Often this didn’t happen and the subsequent payments made on the loan cover were not needed and many customers have claim these payments back.

Sales people selling PPI Policies often included PPI in with the loan agreements as a matter of course, making it a compulsory purchase for financial consumers. Many customers have claimed these policy payments back.

Many lenders told their customers that they had to take out a PPI policy in order to receive the loan or credit they had applied for. Some lenders even included PPI without telling the customer, meaning the PPI policy was mis-sold. This has led to successful claims being made to recover PPI payments made.

Some PPI policies although requested by the customer were sold but were not adequate to cover the customers circumstances, this meant that any claim would be rendered invalid. Cases were this has occurred has included medical conditions, self-employed status or age-related clauses. Many lenders have used these clauses to avoid paying out on legitimate claims.

To check if you have a PPI policy, read through your loan paperwork and monthly cost breakdown and you might notice an extra monthly payment. We at Fast PPI will be happy to discuss that extra monthly payment and advise on whether it’s a PPI payment and to discuss whether it may have been mis-sold to you.

It’s not illegal or wrong for lenders to destroy paperwork after 6years following the end of a finance or loan agreement. At Fast PPI we can still look into your query and contact the lender on your behalf to explore the possibility that you had a PPI Policy and advise whether a claim may be worth pursuing.

What lenders are involved?

Nearly all the major banks, lenders and finance houses in the UK have issued PPI refunds, claims companies have recorded successful claims against most lenders.

An important point to remember:

It was common place with all banks, lenders, credit card providers, brokers and car finance companies to sell PPI Policies against loan or credit agreements, so don’t ignore any of your past lenders as they may have mis-sold you a PPI Policy.

Contact us if you would like to claim back your PPI today!