Payment Protection Insurance (PPI), also known as loan insurance, has been heavily mis-sold over the past decade by banks intent on boosting their profits. In many cases, consumers were told that they couldn'tt get a loan if they didn't take out additional coverage. Victims of mis-selling can now get free PPI legal help and claim compensation.
It's a reasonable assumption that few banking and loan officers will have informed the customer that Payment Protection Insurance (PPI) can be purchased separately to the loan product more affordably. The majority of customers also remain oblivious to the fact that loan insurance only offers short-term coverage for just just 12 months, so your on your own once this period elapses.
Examples of Mis-Sold PPI or Loan Insurance
- Pressured into buying PPI by a member of a sales team.
- Informed that it would improve your chances of getting approval for a lo.
- The overall cost was not explained or illustrated properly.
- Not being informed that PPI was included in the projected cost of borrowing.
- The small print of the contract was not fully explained.
- Loan insurance was sold where the T&C's specifically exclude the customer. For example, a 75-year-old customer was sold PPI when the age cut off was 65.
Don't confuse PPI with level term life insurance, mortgage protection life cover or critical illness insurance. Free PPI legal help is not available.
No Win, No Fee Free PPI Legal Help
Due to the scale of mis-selling, lots of private companies are now offering free PPI legal help on a no win, no fee basis. This means that no costs are ever incurred regardless of the outcome of the case. Should the outcome be successful, the fee is generally about 25 per cent of the settlement figure.
Provided that the loan was taken out within the last 6 years a mis-sold PPI claim can still be registered. It may also be possible to take legal action if the paperwork is held personally. The six-year rule relates to the timeframe when the lender has a legal obligation to provide it.
What Happens if I'm in an IVA or Debt Management Plan?
The claim won't be negatively affected if the loan insurance relates to an agreement that is currently in an Individual Voluntary Arrangement (IVA) or debt management plan. However, any settlement gained will form part of the money that goes to other creditors. It's worth submitting a claim if in a debt management plan as the there's no debt write off, so the amount you owe can be reduced.
A consumer who has taken out Payment Protection Insurance on personal loan should seek free PPI legal help. A successful claim will lead to compensation being awarded. If you're prepared to do your homework, you may be able to recover PPI on your own, and that means no 25% settlement fee.
Asa Ghaffar - Asa has over 10 years of practical experience in loan approval, secured lending, bad credit repair, stock trading and debt management.
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