The number of personal payment protection insurance (PPI) claims is on the rise, according to the latest figures on the subject. Millions of people across the UK have been mis-sold the protection insurance, and now they are claiming back funds they should never have parted with.
This type of insurance is a form of payment protection which ensures that, should you lose your job, fall sick or be involved in an accident, you are still able to make any necessary repayments. Yet, many have been mis-sold the financial product as it was not suitable to their individual circumstances.
Leading high street banks and other lenders have been blacklisted as some of the biggest culprits of mis-selling PPI. Ofgem exposed banks and lenders for the process of adding the insurance policy to other financial products without the customerís knowledge.
Leading British banks have already set aside £7.4 billion to cover mis-sold PPI compensation, yet experts say this is just the start. They have already paid out over £200 million in the first 6 months of 2011.
The Financial Ombudsman Service (FOS) recently published a report of complaints data, and found an increase of 54% in PPI complaints in the first half of this year compared to the second half of 2010.
There were almost 100,000 new PPI claims between January and June 2011. If you think you may have grounds to make a claim regarding mis-sold PPI, here are some top tips about the product;
1. How was PPI sold?
Payment Protection insurance is often sold onto the end of a financial product, such as a personal loan or credit card. They can also be sold with larger loans such as mortgages, a product known as mortgage payment protection insurance (MPPI). They can also be sold as part of car loans, secure and consolidation loans.
2. Who can claim?
If you believe you have been mis-sold payment protection and have been paying for an insurance policy without your knowledge then you may be able to claim for PPI.
Banks often embed the cost into the fees and charges that you pay on the loan or credit. In a number of cases, it was not fully explained to the consumer and many policies do not even cover them. If you were sold PPI when you were unemployed, self employed, a student or in retirement, the policy will not apply to you and is therefore invalid. This means that you could be entitled to claim for compensation.
3. Know your dates
If you have a loan, or have had one in the last 6 years, you could be within the time frame which allows you to claim compensation. Those who have been mis-sold PPI after the 14th January 2005 are eligible to claim. If your loan or credit card was taken out before this date you could still have a chance to claim, but it might be less successful.