What is Payment Protection Insurance?
Payment Protection Insurance (PPI) is an insurance policy that is set up to cover your payments on a loan or credit card should your income be affected by factors such as accident, sickness or unemployment.
What commitments are covered by Payment Protection Insurance?
With such a large range of lenders and products available, most forms of credit can be covered by Payment Protection Insurance. Typically, these would include:
- Personal Loans
- Mortgages
- Credit Cards
- Car finance
Is Payment Protection Insurance compulsory?
No. PPI is not compulsory though some lenders will sell the policy along side the loan due to the protection it offers. Lenders are under obligation to inform you of your right to shop around, you do not have to purchase PPI from your lender, and should not feel pressured into doing so.
Why can I claim?
The Financial Services Authority (FSA) has recently fined a number of high street banks and lenders because of Payment Protection Insurance Mis-Selling. The following is a list of scenarios most likely to give rise to a claim for compensation for a Mis-Sold PPI policy.
- Was it implied or stated that the loan would be more expensive if you didn't take the insurance?
- Was it implied or stated that you you were required to take out their policy to qualify for the product or help with your application?
- Was the salesperson pushy when selling the product so that you felt you couldn't say no?
- Did the salesperson require you to sign the insurance agreement before you could continue with the loan application?
- Did you already have insurance cover?
- Have you tried to cancel your policy?
- Is the insurance term too short?
- Do you have a joint loan but the insurance is only in one name?
- Were you self-employed, unemployed or retired?
- Had you had medical problems in the past?
Can I make more than one claim?
Yes, if you have had several lines of credit over past years you may have had more then one payment protection policy which have been mis-sold.
My loan has been paid off, can I still claim?
Yes, if your loan has been paid off you can still make a claim.
What do I have to do?
Contact Legal Advice Helpline today on 0800 612 3042, or complete an online enquiry so that we can contact you.
How much will it cost me?
Our specialist solicitors operate on a "No Win No Fee basis".
My lender told me I had to take out PPI to have my loan approved. Is this correct?
No, you may have been Mis-Sold Payment Protection Insurance as your loan application is not dependent on the PPI policy being taken out.
I was not informed PPI would be part of my loan, do I have a claim?
Yes, it is not uncommon for lenders to include Payment Protection Insurance into the loan without determining your needs or you being fully aware of this. In this case you may have been Mis-Sold PPI and you could pursue a claim.