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Is PPI Compensation Worth all the Fuss?

It is a financial product that everyone must surely have heard of. PPI is infamous. It was mis-sold over many years and to thousands of customers.

Fuss

Now, the banks are paying back this money and it is costing them billions - £32.9 billion at the last count. Customers have until 29th August 2019 if they want to get their money back. But is it worth making a fuss about?

Dishonest Practice

Payment protection insurance (PPI) is a by-word for dishonest selling practice, something has, over the years, cost thousands of people a lot of money.

Many people will have been paying an extra 20 to 30% more on their loan with the addition of PPI - and yet, the policy for many people was effectively useless.

Commission Payments

When a broker sold a PPI product, they were paid commission. This is not an uncommon practice, but some commission payments were a lot higher. The argument is simple: if you had known how much commission you were paying, would you have queried the cost of the policy? We think so when you realised the majority of what you were paying was lining someone's pocket and not providing you insurance cover.

Was PPI any good?

This is a difficult question to answer because like all insurance products, some suit some people better than others.

Payment protection insurance is narrow in who it covered and what it covered. For example, anyone without income protection policies or a decent benefits package at work, then PPIcouldhave been a decent insurance policy to have.

But if you had pre-existing medical conditions, it was of no use. If you were older than 65, it didn't cover you. And there were other exclusions too, but you probably weren't told about them…

The problem is…?

… mis-selling.

Banks made huge profits from the sale of every policy they sold. Add to this the commission payments that representatives of the banks took home and you can soon see the crisis lurking in the wings.

  • Many banks also gave their sales representativesmonthly sales targets of PPIto meet and, if they did hit these targets or surpass them, the bonus they received was very handsome indeed.
  • The scale of the problem is because the customer trusted their bank to do the right thing by them, but your band had one thing at heart: making money.

PPI Deadline

You have until August 2019 to claim your money back. But we are advising our customers not to wait and to make 2018 the year the year they enjoy a welcome financial windfall.

If you would like help or would like to know more about our service, you can call us today and chat with one of our friendly advisers… we do have your interests at heart!

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