PPI Claims

ppi claims

What is PPI?

PPI (short from Payment Protection Insurance) is a type of insurance that is often issued alongside credit products such as a home loan or credit card. Payment protection insurance is designed to cover the cost of repaying their loan or credit card if the borrower should happen to die, lose their job or suffers some unfortunate circumstance which prevents them from being able to pay back the loan.

PPI Claims

While PPI is important it is not compulsory and there have been many instances over the past 5 or so years of companies mis-selling PPI. Such mis-selling includes adding a PPI premium to a loan without consulting the borrower or not being clear about the exclusions of the insurance policy. Indeed, a number of surveys indicate that a large proportion of those who have taken out PPI were not aware of doing so.

If you feel that you may have been mis-sold PPI, you can make a claim. Most people prefer to use a PPI claims company to make their claim. This is often less stressful and many PPI claims companies work on a no win no fee basis which means that the individual will only be charged if they win the claim.

However, the cheapest way to make a PPI claim is to do it yourself. To begin with you should complain to the company that you think mis-sold you PPI insurance. if your case gets rejected by the company or if they do not get back to you, you can contact the Financial Ombudsman Service.

A third option is to take the claim to court. Using a lawyer you can make a complaint via the Small Claims Court system. This option is often quicker than making a complaint via the Ombudsman service, however, it does incur costs as you are charged if you do not win the case at the court and if you need the help of  a lawyer you will have to pay them too.

In summary:
  • You can use a PPI claim company or you can make a PPI claim yourself
  • If you are dissatisfied with the company’s response you can contact the Financial Ombudsman Service

 What to remember when making a PPI claim

If you are making a claim about a PPI policy that pre-dates 2005 and the broker of the insurance was not regulated by the FSA or FCS it may be harder for you to make a claim. This is because it means that the Ombudsman does not have any authority in these cases.

If you choose to utilise a PPI claims company to make your claim, it is important that you do your research. To begin with you need to make sure that the company is well-established. Once you have established this, you should then look into how much they charge if your case is successful. Finally, it is always a good idea to check up on reviews. Reviews can indicate just how successful the company is at winning cases and will also give you an indication of the customer service they provide.

In summary:

  • Mis-sold PPI cover that pre-dates 2005may be harder to reclaim.
  • If you decide to use a PPI claim company, make sure that they are reputable and have good reviews.
  • Compare PPI claims company fees. The average fee for a successful case is £25%