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Is Claiming PPI Compensation Really as Easy as They Say?

Spend no longer than five minutes searching the web for information relating to PPI compensation claim and you will see a whole host of websites telling you how easy it is to claim back your money.

Easy

But is it that simple?

Most claims are straightforward

There are many, many cases of people claiming back their money with no hassle at all. This as a result of a variety of factors. For example, mis-selling is clear - the bank knew they were self-employed, for example, or over the age of 65 years etc. - and so there is no quibble.

Other claims can be more complex

Despite what various websites say, there are some claims that are more complex and some claims that become a nightmare because the bank or lender don't always follow the rules, so to speak.

Why do some PPI claims become a problem?

There are many reasons but for some people, it can take time and effort to unravel what the issue is;

  • Telephone sales

Many people were sold PPI as an 'add-on' product weeks or possibly months after they bought the original loan. There are rules about how sales can be made to you over the phone, the information that is given to you such as the cancellation period and so on. Some customers felt they weren't given all the information. Banks say that they were but with most phone calls recorded for 'training purposes', there is evidence that can be listened to. But how you interpret the call and the how the bank does can be very different.

  • Advised sales

There was a question mark hanging over what used to make an advised sale and what wasn't. In other words, when the bank was telling you it was the best policy to fit your needs and when they were making suggestions that it may have been the right policy. The rules are much clearer as a result of the PPI scandal - the bank has to advise customers in writing why a policy is the right one.

Who sorts out the PPI compensation mess?

When it comes to issues between the banks and the customer, it is the Financial Ombudsman who sorts out who is right. They also tell the bank how to put it right if it is their fault.

They don't just work on PPI compensation complaints, they work across all kinds of financial products and services. They have taken on hundreds of extra staff to try and get through the PPI complaints as fast as possible.

At one time, customers were given the impression that unless they had 'fresh' evidence, there was not much point taking their PPI complaint to the Ombudsman. But this isn't the case.

Even better news, the Ombudsman is still finding that the customer is right more often than the banks. If your claim has been refused, contact the Ombudsman for information on how to submit your claim to them. Or contact our expert team!

PPI Jargon

Don't know your redress from your alternative redress? Don't be confused by PPI jargon! Use our handy guide to cut through it.

Jargon

Jargon

Explanation

PPI

Payment protection insurance is the name given to the product that has been mis-sold to thousands and thousands of people. It may not always be referred to as PPI on your account. For example, it could be called 'loan care' or 'card protection' etc.

Look for anything that promises to make repayments on the account if you are unable to as this is more than likely PPI.

 

Redress

This is another word for compensation and is the monies that you get back in compensation

 

Monies

A financial term for the settlement or the amount of compensation you receive

 

Single premium policy

Some PPI products were charged at a monthly price, whereas others were sold and the customer paid for it in one lump sum. These are no longer sold in the UK as the issue was that not only was the policy unsuitable for people in many cases, they were also not lasting the length of the loan and, when customers cancelled them, the bank did not reimburse them their money

 

Advised sale

This is where a customer, like you, may have been told - that is, advised - to take out the policy. However, you may not have told explicitly why the product was right for you. Today, when any financial product is sold to you on an advised basis, you must receive a letter that details all the reasons why it is the right policy for you.

 

Alternative redress

This is a common phrase and is used to describe a loophole within the law that some banks are exploiting. Instead of compensating customers the full amount, they are paying back the difference between the cost of their policy and the next cheapest.

*UPDATE banks and lenders are now compensating customers according to the guideline of putting people back to where they would have been financially had they not been sold PPI*

 

Term

This refers to how long your loan lasts for, such as 10 year term or 5 year term. In other words, if you borrow a £10,000 over a 10-year term, by the end of 10 years you will have paid it back.

 

It is important as it has been discovered that some PPI policies fell short of the term of the loan, hence in other words, the PPI stopped covering you in year 8 of the loan, meaning if you wanted to make a claim after this, you would not be able to.

 

Commission

This is a payment made to the broker for arranging from the lender for arranging their financial product for you to buy. It is a widespread practice and a way of getting their product before their competitors, but banks and lenders failed to tell customers how high this commission was. The average commission payment was 67% of the cost of the loan so for every £1,000 you borrowed you paid another £670 on top in commission. Now that you see the figure, it seems ludicrous!

 

 

Can I Claim More PPI Compensation?

The court case brought by Susan Plevin against Paragon Personal Finance Ltd was some years ago but the judgement, and how it affects other customers, has only been decided upon in recent months. The fact that Plevin won the case sent shockwaves through the banking industry who are braced for another wave of PPI compensation claims.

But what is the 'Plevin Case'? And how does the judgement affect you?

Justice1

What Was the Plevin Case All About?

Susan Plevin on taking out a sizeable loan and PPI. In this case, the argument was not centred on the mis-selling of PPI as a product itself but on the amount of commission paid and the fact that this was not disclosed to Susan Plevin.

The court agreed that under the Consumer Credit Act 1974, this made for an unequal relationship between lender and customers. Plevin argued that if she had realised over half of the cost of PPI had been commission for the broker, she would have queried the cost.

How Does Plevin Affect You?

Not everyone who has made a claim will be entitled to more money back.

  • Successful claim - if you have made a successful claim, you probably won't be entitled to any more money back because you should have received everything back in full.
  • Unsuccessful claims - if you made a claim for PPI compensation and didn't get a refund, you may be able to go on and make a separate claim relating to commission. This ruling stands whether PPI was sold to you in the right way or not.

According to the Financial Ombudsman, you may be able to complain about commission if;

  • You took out the credit (loan, credit card etc.) with PPI on orafter6 April 2007
  • You took out the credit with PPIbefore6 April 2007 and it was still running on or after 6 April 2008

How to Claim PPI Compensation for Mis-sold PPI and PPI Commission

If you want to claim compensation for commission and/or mis-sold PPI, you need to:

I. Contact your lender or bank and tell them you believe you have PPI and it was mis-sold to you

II. You need to tell them why you think you are entitled to compensation

III.  You also need to find out how much commission was paid on the sale of PPI to you

IV. If your claim for mis-sold PPI compensation is unsuccessful, your claim for compensation on commission paid could still be successful - the commission needs be more than 50% and you were unaware that commission or this high level of commission had been paid

Of course, you can always call us for help and support in making a PPI compensation. Our teams assess you claim thoroughly, can trace accounts and PPI policies, and they can ensure that you get back everything you are entitled to. Find out more - call us today!

Legal Challenge to PPI August Deadline Unsuccessful

You may recall that a claim management company was attempting to stop the PPI August 2019 deadline of being imposed. Unfortunately, the courts have ruled that there is no case to answer and that by setting a deadline, the Financial Conduct Authority are within their rights.

Justice 2

Why Did the Challenge Happen?

Payment Protection Insurance (PPI) was mis-sold on a huge scale. So much so, that millions of people are now claiming their money back. The product was designed to protect the debt in the event the customer was no longer able to make repayments as a result of the loss of income due to illness, redundancy etc.

Unfortunately, the commission and large profits that the sale of PPI policies offered meant that it was sold to people who didn't want or need it. When this was discovered, the wheels came off with banks and lenders now facing a whopping compensation bill.

But, the writing is on the wall and it seems that it has been firmly etched there: there will be no new compensation claims for mis-sold PPI (sold before 2017) after 11.59pm on Thursday 29th August 2019.

There is no slippage or safety zone with this date and time. Put your compensation claim in by then or face waving goodbye to potentially thousands of pounds of YOUR cash.

A claim management company (not us!) felt that this was unfair. They weren't alone. Experts such as Martin Lewis agreed that it placed the protection of financial industry interests above that of consumers.

But the courts don't agree. They have not awarded the right to appeal against the decision and so unless the wheels come off this particular bus, the deadline is set to stay.

What Does This Mean?

It means that unless the advertising campaign commissioned by the Financial Conduct Authority does reach everyone that it needs to, there are potentially thousands, if not millions of customers who face not claiming their money back.

Many organisations believe that the FCA has underestimated the number of claims yet to be made and that the 64 million PPI policies that they say were sold in the UK is also an underestimate. What people are concerned about is the short amount of time there is for banks and lenders to process what could potentially be a huge number of claims.

If this means the system is swamped, your case could be in it.

As yet, we are still waiting to see what the Court of Appeal rejected the case against the deadline but when we do, we'll let you know.

In the meantime, you really do need to start the ball rolling on your case. If you are yet to make a claim for PPI compensation, start TODAY!

PPI Questions and Answers

There are so many questions about PPI compensation, but we have taken a look at some of the most recent questions our teams are being asked…

Questions

Q. I think I agreed to PPI. Surely, this means I can't make a claim?

Payment protection insurance (PPI) was mis-sold in so many different ways that, even though there are long lists of proven mis-selling reasons, on occasions, it does come down to individual cases and circumstances.

In this case, the successful conclusion of the case would lay in whether the bank knew your circumstances, such as your employment situation, fully at the time they sold you PPI. In most cases, the bank or lender would have known, as they would have performed cursory checks to satisfy themselves that you could make repayments on the loan.

There is also the additional complication of commission. Were you told, for example, that the person selling you the product would receive a commission? If so, how much was this? There are more questions that need asking about your claim which is why we would be happy to take a closer look - why not have a no obligation chat with our team?

Q. I have a bank account that is permanently overdrawn and I have since discovered that some of the 'fines' I paid for late payments etc. was down to the bank taking out PPI premiums. I have read that I may be able to claim back these late fees and fines too - is this a possibility?

This has been in the headlines recently as a claim management company brought it to the attention of the authorities that banks were still picking and choosing what they compensated in terms of PPI payments.

Many customers, like yourself, did suffer from fees and costs being added to their accounts as a result of high PPI premiums being paid.

The Financial Conduct Authority and the Financial Ombudsman Service have told banks and lenders that they must compensate customers back to the financial position they would have been in if PPI had not been added to their accounts.

Again, we need to know more to be able to advise you specifically on your case. Our team is waiting to take your call.

Q. I have no idea if I was mis-sold PPI because I really can't remember. I just signed the paperwork put in front of me. It was a difficult time, emotionally and financially for me, and the loan was needed for all kinds of mundane things, such as roofing repairs. Do you think I have a claim?

This is something we hear time and again. People went to their banks for advice and help when they were in need of financial help, only to have a policy sold to them that was of little or no use.

Our team will be more than happy to look at your claim and here's the best bit - we do so without obligation AND, we operate on a no win, no fee policy so you don't need to pay us unless your claim is successful.

What Does ‘Compensation’ Actually Mean When It Comes to PPI?

There have been many twists and turns in the PPI saga and even with a deadline date of August 2019 set, there could be many more to come.

Scottish Money

Customers have claimed back their money, erroneously paid to their bank or lender for many years for a product - payment protection insurance - that was of very little value to them.

And just when we think the banks and lenders have 'got the message', another twist comes along that shows the banks and lenders are still desperate to hang on to every penny of their profit, even if some of this profit is not rightfully theirs to keep…

Fees and costs - PPI was an expensive insurance product.

Higher priced than other PPI type products on the market, customers were stunned that the price they had been quoted for the cost of their loan was a lot higher. This was simply down to PPI being added to it.

If you struggled to pay, you may have been faced with additional fees and costs. It seems the banks and lenders have been conveniently 'forgetting' about these expenses and have not been including these in their final compensation payments to customers.

Spotted by a claim management company, both the Financial Ombudsman Service (FOS) and the Financial Conduct Authority (FCA) are warning banks and lenders to make sure they take these fees and costs into account - and reimburse them in compensation pay-outs!

Commission payments

A customer took her complaint to the courts because she found out that the broker received more than 50% of the cost of arranging the PPI policy in commission. She successfully argued that if she had known this, she would have questioned the £5,000 PPI premium.

Now that the ruling has been passed, you could be entitled to more compensation; that is, the cost of commission paid to the broker, sales rep, bank employee or whoever arranged PPI for you.

Compensation Means…

Putting you back into the financial position you would have been in had PPI not been sold to you. This means awarding you interest, as well as returning all fees and costs alongside premiums paid and now, any commission over 50% that you were not made aware of.

This is the guiding principle in all claims for compensation in terms of financial products, not just PPI.

Make a Claim with Payment Protection Scotland

Here at Payment Protection Scotland, we check all PPI compensation settlements from banks and lenders to our customers. We advise you if we think this figure is wrong, but it is your decision as to whether you accept the figure or not.

All you need to do is contact Payment Protection Scotland and we will be happy to help. We charge a flat fee for our service and with a high success rate, you can be confident your case is the right hands. Find out more - call us for a no obligation chat!

Credit Card PPI – Learning from Past Claims

Customers have been claiming back thousands of pounds in compensation for mis-sold PPI. And with the PPI deadline set for August 2019, it is important that if you intend making a claim that you do so. Check everything from loans to catalogue accounts but especially credit cards. And here's why…

Credit Card

Back in March 2012, a father of two from Essex spent 16 months locking horns with Barclaycard to reclaim his PPI premiums. He had two credit card accounts over for a long period of time. PPI on credit cards was calculated as a % of the amount outstanding each month - so the more your owed, the more PPI you paid. As a result, credit card companies are some of the lenders who have paid out some of the largest PPI compensation claims.

In this case, the PPI policy was added to his account without his permission. This is a fairly typical example when it comes to PPI and credit card accounts. It is one of the main reasons why PPI payments are at a record high - banks and lenders simply added the PPI without the knowledge of the account holder.

First Claim Unsuccessful

This customer attempt to reclaim the money back in mid 2010, was unsuccessful with Barclaycard rejecting his claim. But he was not put off, convinced he was right and that he was owed money. Not only was the policy added without his consent or knowledge, he had ample cover with other insurance policies.

His first step was to contact the claim management company he had been workingwith for free advice and help. They knew his case well and they too, felt that his case had been unfairly dismissed. They advised their client to lodge his complaint with the Financial Ombudsman. They can do this on his behalf, which they did, but only after attempting to get the claim paid out with Barclay card a few more time.

After letters and phone calls this customer by early 2012, was in receipt of a cheque for£82,000 in PPI compensation. It took some time because the Financial Ombudsman is dealing with thousands of cases with the average wait time now around 12 months (unless you can prove significant financial hardship and they will look at your case sooner).

3 Important Lessons

  1. Don't be put off by a refusalfrom your bank or lender - seek help from your claim management team, if you have one, or talk with the Financial Ombudsman for advice.
  2. Be realistic about the amount of compensationyou could claim back - there are amazing stories of huge pay outs but compensation as high as this customers' tend to be the exception rather than the norm. that said, until you launch your claim for PPI compensation, who know how much you are entitled to?
  3. This is your money- don't be put off making a claim.

For a no obligation chat, call us today and find out how much you could claim back in PPI compensation.

The Facts About How PPI Was Mis-Sold

A PPI policy was mis-sold to you if you didn't…

  • know about it
  • ask for it or
  • need it.

There are a whole host of specific reasons why the PPI policy could have been mis-sold to you. BUT, every case is different and unique to that customer. Although we have listed the main reasons why PPI could have been mis-sold to you, we would need to examine your case in detail so that you have the best chance of getting your money back.

Facts

Which of these reasons for mis-selling do you think fit your case?

  • You were NOT told about the true cost of the policy
  • The policy term was shorter than the term of your loan
  • Exclusions were NOT fully explained to you, such as medical exclusions
  • Your circumstances meant you would NOT have been able to claim
  • You were self-employed and that to claim on the policy, you would effectively have to close your business
  • You were NOT told the commission the sales person would receive for selling you the policy - *UPDATE* if commission was more than 50% the cost of the policy and you were not told this, you can claim your money back!
  • You were NOT told there were alternative insurance policies available
  • You were told you HAD to take out the PPI policy to secure the loan
  • You were told that the loan, credit card etc. was ONLY available with PPI
  • PPI was included in the loan without you knowing
  • You already had existing cover with another policy
  • PPI was NOT necessary as you had cover with your employer which was sufficient

The average PPI pay-out is calculated at £2,750, a figure arrived at by dividing the value of the PPI policies sold with the number of people they were sold to. BUT, this figure can be very different as there are many variables that affect cases such as interest rates on credit cards and so on.

Some customers are claiming PPI compensation for policies that date back decades, so don't be swayed by stories of time limits and deadlines. If you had a loan, credit card or mortgage in these last 6 to 12 years, the likelihood is you were mis-sold PPI for one or more reasons outlined above.

PPI compensation for your bank or lendershould put you back into the financial position you would have been in had the PPI policy not been sold to you.This means all your premiums compensated, along with interest and now, commission payments too.

Making a claim

You can make a claim by approaching your bank or lender yourself but with most people having more than one policy, it can be a time-consuming process. With this in mind, you may want Payment Protection Scotland to do the hard work. We charge a fee for our service but with our no win, no fee service, there is no risk to you. Why not call us?

Rules for the PPI Deadline Date

You are probably aware by now that the Financial Conduct Authority has set a deadline for PPI compensation claims. In the summer of 2017, they launched their advertising campaign to inform people who want to make a claim for compensation about how to do this.

Deadline

We think it is important that you understand the ruling behind the deadline and why it is important that you don't wait to make a claim for PPI compensation but start your claimas soon as possible.

When it the deadline?

The FCA has decided that the deadline for PPI complaints is 29th August 2019. It is a Thursday and customers have until 11.59pm on that date to make a complaint.

Don't wait

Don't wait to make a complaint as the FCA, along with most banks, believe that there will be an influx of claims for PPI compensation. It takes time for cases to be assessed and providing you have your claim to your bank by 11.59pm on Thursday 29th August 2019, the bank or lender is duty bound to assess your case.

Ways to complaint

If you decide to make a claim, you need to remember that:

  • By post - your letter or PPI claim form for your lender will need to reach them on or before 29th August 2019. Postal claims received from Friday 30th August will NOT be considered.
  • By phone - some lenders and banks have PPI helplines through which customers can make a claim but these will close before midnight. If you leave it too late, you will miss out.
  • Online - if there is an increase in submissions made online on the 29th August, you may find that the bank or lender websites will not be able to cope with the volume of users. If the site crashes, you may find you are unable to lodge your complaint in time.
  • Claim management companies - CMCs such as ourselves will, no doubt, set our date by which we can accept and process PPI compensation claims near to the deadline. To take advantage of our service, you need to contact us straight away to get your case moving.

This deadline is for PPI claims on policies that were sold before summer 2017. Anything sold after that time which the customer believes has been mis-sold will be dealt with separately.

How to claim

Check that you have PPI on loans, credit cards, store cards, catalogues, car finance, any account on which you borrowed money. If you find PPI, you could have a claim.

Or, why not talk to our team about our PPI finding and claim service? With no obligation to continue with a claim, you have nothing to lose!

Why Use a Claim Management Company to Make a PPI Compensation Claim?

There has been a lot written (and a lot of misinformation too!) about PPI and how to claim compensation. In equal measure, there is a lot written about claim management companies that offer a 'claim on your behalf' service.

Question Mark

Many people have chosen to use a claim management company, like Payment Protection Scotland but you can claim PPI yourself too, through your bank or lender. So why do people work with claim management companies and how do you choose the right one for you?

Myth - Faster Claims

It is only in recent years that claim management companies (CMC) are being regulated but when the PPI saga first hit the headlines, many companies sprang up, offering PPI compensation claim services. Their marketing wasn't always the best and slowly, a myth developed that putting your claim through a CMC would yield faster results.

It doesn't. Banks and lenders have deadlines and timeframes within which time they must respond to the customer and as a CMC, we cannot force this process to be any faster than it is.

True - The Majority of CMCs are Professional and Reputable

Most CMCs take their business seriously and in order to further their professional reputation, they offer unparalleled customer service and care. The information and advice they give to customers are tailored to the customer's case and even when a PPI compensation claim is refused, they will continue to help them lodge their claim with the Financial Ombudsman.

True - We Do the Hard Work…

… so you can carry on living your busy life. Frankly, spending hours on the phone, writing letters, lodging complaints and chasing cases may not be your idea of fun in your leisure time, and other people agree. And this is why many people turn to CMCs to help them make their claim.

True - The Banks and Lenders Haven't Always Acted in the best Interest of Their Customers

If the banks and lenders had placed the customer as the centre of their services, we wouldn't be in this predicament in which thousands and thousands of people are claiming billions back in compensation. CMCs have led the way in making sure that customers get the information they need but have also spotted significant errors in the compensation amounts offered to customers.

True - WE Work for YOU

When you contact Payment Protection Scotland, we work for you. We act when you tell us and we stay in touch throughout the claim process so you know what is happening to your claim. There is no obligation to continue with your claim with us, and we operate on a no win, no fee basis too: you only pay if your claim is successful.

We offer a professional service for anyone seeking to claim PPI compensation. Call us and get your case started today!