PPI is a term that we often hear in news and are not exactly clear about it. Basically, PPI or payment protection insurance is a kind of insurance that is sold by agencies when you take a credit card or loan of any card. The insurance was framed to make sure that a creditor can make the monthly repayments for the loan without any lapses in case one loses a job or falls ill. However, the insurances were sold by companies in a wrong way. Thus, a PPI claim is made in order to get compensation for the misinformation given to you.
Banks are now faced with a scandal running into millions due to the mis-selling of the PPI by agents. As per the instructions are given by the FSA or Financial Services Authority, banks must identify the customers who, as per their records, were mis-sold policies. This means the bank would send you a letter to customers carrying the information on how they can claim back their premiums.
However, sometimes, due to the systematic failure, banks may not send the letters to the affected customers. This does not imply that a customer who was mis-sold a policy cannot make a PPI claim.
Were you mis-sold a policy?
You can make a claim for compensation of premiums if:
- You were sold the insurance without giving you information about the same.
- If you were self-employed, part-time workers or unemployed
- If you were suffering from a pre-existing illness
- When the loan repayment extended beyond the policy coverage time.
- When the customers were not explained completely about the policy terms and conditions. (They were not told that insurance amount would add to the loan and you have pay interest on the sum total).
You should check the documentation of the procedure when you obtained a loan. Even if you have paid the entire amount due on the loan, you can reach out to the creditor to find if PPI was also sold to you. This can be reflected in the bank statement in the past that include phrases like protection cover in thePPI claim.
Making a claim
The process of recovery is quite simple. The only point is you have to be persistent in case a company shows their reluctance to pay back the claim. You can fill a form available at the Financial Ombudsman Services. Submit this claim with your creditor. Most companies would pay the claim within 8 weeks. Otherwise, you can submit a complaint to the Financial Ombudsman to recover your amount from PPI claim.