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Archive for tag: Payment Protection Insurance

Payment Protection Insurance OR Income Protection Insurance?

There are many insurance policies available to buy. The one distinct advantage of having access to the internet is that you can research what each policy offers while giving your chance to compare the premiums from provider to provider.

Opportunity

With payment protection insurance (PPI) being at the heart of the biggest mis-selling scandal to have rocked the UK banking industry, it can be easy to confuse one group of insurance products with another.

Income protection insurance is one that is commonly confused as a PPI policy but there is a difference.

What PPI should offer

PPI is a generic name given to an insurance thatpromises in the event of you being unable to work due to long-term illness or unemployment that it will make repayments on the loan it is secured against.

Most mortgage providers insist on some form of insurance or life cover for the mortgagee so that in the event of the work case scenario, there is an opportunity for them to claw their money back.

Is income protection the same as PPI or something different?

Income protection insurance has a wider scope than PPI.

This type of policyprotects your incomeand is a package that many employers offered their employees as part of a benefits scheme.

In others words, for a small premium each month, your monthly income was protected for a certain length of time. In most cases, this would be 12 to 18 months, long enough to either rehabilitate, get back to work or to retrain and create an income another way.

Competitive or not?

Financial experts now say that the income protection type insurance can offer all-round better protection but it is imperative that you read and understand the terms and conditions.

After all, on being unable to work you do not want to discover that the policy is of no use if it does not cover a pre-existing medical condition, for example - just like PPI did!

The more the income protection policy promises to cover, it follows that the more expensive the monthly premium will be.

PPI on the other hand did not offer a competitive premium for the limited scope it offered customers.

Not only that, the way it was sold was unfair to the vast majority of customers. It simply did not, in some cases, cover people because they were either self-employed or retired - yet the banks still sold it to their customers, knowing that it offered them no protection.

Looking for a new insurance policy of any kind? Learn from one major PPI mistake!

Customers were not encouraged to shop around and get a better deal for their money. When buying any insurance, including PPI and income protection, shop around and get the right premium at the right price.

Is Payment Protection Insurance any Good?

There many insurance products that you can buy in to that cover all kinds of eventualities. From life insurance cover to critical illness insurances, there are many products, many brands and different levels of insurance cover, all at differing costs.

PPI was one of them. Despite is poor reputation as a result of the mis-selling scandal, it is possible to buy PPI. In some cases, it may be the right insurance policy for you.

Clearly, protecting the things we love and own is important. There are some insurances that are more important than others. Some insurances are compulsory;

  • Car insurance- compulsory and essential, driving in an uninsured vehicle will lead to serious consequences.
  • Buildings and contents insurance- important too, should anything structural happen to your property or should there be issues with the contents of a property and so on. Some mortgage companies will insist you have buildings insurance to cover the cost of re-building your property.
  • Critical illness cover and so on- protecting ourselves is important too, especially if one person is responsible for paying the mortgage and so on. This type of insurance can give us peace of mind.
  • Income protectioninsurance- is similar to critical illness cover but covers you to the level of your income.

With any kind of insurance policy, seek independent financial advice to make sure that the policy is the right one for you.  

So, there is nothing wrong with PPI?

There may be some instances in which PPI is the right policy for someone to have. There are all kinds of variable and factors that affect this decision;

  • Benefits from work- many people a generous benefits package from work which should be considered. For example, if you are off ill for any length of time, you may enjoy 3 months' full salary from work before your income drops. This means you won't need a PPI type or income protection policy to kick in until after 12 weeks.
  • Check the insurances you already have- PPI in many cases was a duplicate policy. This means banks forced it on people, telling them that other insurance products were not good enough. They also said that a customer needed to take out the bank's own PPI product.
  • Value for money offered- PPI in the case of mis-selling was expensive and poor value for money. In other words, you were paying a hefty monthly premium for little cover.

Can you claim PPI compensation?

It may be that you can claim back all your PPI premiums, along with any other costs and fees including the commission paid if it was more than 50% and you were not told this.

There are many reasons why PPI was mis-sold. Many people - just like YOU! - have genuine claims for compensation. Are you one of them? Find out by calling Payment Protection Scotland today.

Payment Protection Insurance – are you sure you don’t have a claim?

The announcement of a 2019 PPI compensation deadline announced a few short months ago, the debate around PPI has been re-ignited.

What dominates the headlines this time is the fact that less than half of those entitled to make a claim for PPI compensation have done so.

So, check again - are you really sure you don't have a claim for PPI compensation?

Have you been in receipt of a loan, had a credit card or store card or opened a newmortgage in the last 12 years or so?

The likelihood is that most people have some form of credit facility with a major bank or lender in Scotland as well across the UK.

Banks make their profits by lending money to customers and they made gigantic profits on the back of selling PPI to customers. If you knew the majority of the cost of PPI was profit for the bank, would you have still bought and at the price they were charging?

It is NOT a complicated process...

If you find you have PPI on your accounts, you may have a claim for compensation.

However, the onus has been placed on the customer to prove they were mis-sold PPI, the four top mis-selling reasons being;

  1. You were unaware you had bought PPI- in some cases, the product was automatically added to the account without your permission.
  2. You were told it was compulsory- PPI, along with many other types of insurances of this nature, are optional. Covering your income is not a bad idea but you need not have bought the bank or lender's own product. Some customers already had insurance cover in place therefore did not need an additional product.
  3. Some customers were led to believe that they would be more like to be accepted for a loan or credit card etc., if they took out the PPI policy - this is unfair selling practice and simply not allowed. Credit is based on your credit rating, nothing else.
  4. You were retired or self-employed at the time or had a pre-existing medical condition- this relates specifically to the terms and conditions of the PPI policy. Many customers would not have been covered in many cases and, according to a variety of complaints upheld by the Financial Services Ombudsman (FSO), they would not have taken out the policy of these terms and conditions had been fully explained to them.
  5.  I have no paperwork or policy numbers

It may still be possible to make a claim. You can pursue this yourself or you can engage the services of a specialist claims management company like PPI Scotland.

We charge a fee for our service which we will clearly explain to you if you decide to proceed. This is a flat fee, although we charge on a no win, no fee basis.

Contact us today, to talk to our friendly team about making your PPI compensation claim today.