The PPI Deadline
We’re now into the final month of the PPI claims deadline which has been set on 29th August. Whilst many will breathe a sigh of relief, there’s estimated to be millions of people who won’t have claimed PPI compensation that would be rightfully owed to them.
What is PPI?
PPI or Payment Protection Insurance was sold as a product to people who took out finances such as a bank loan, mortgage or credit card. It was designed to make payments on the finance should the customer be unable to pay due to illness, unemployment or several other reasons.
How was PPI mis-sold?
The height of the mis-selling scandal was between 1985 and 2010, however PPI policies were sold before and after that time. There were 3 different ways that PPI policies were mis-sold:
- Staff wrongly informed customers that the policy would help them be approved for the finance
- Staff did not ask about any pre-existing medical conditions which may have made the policy invalid
- Policies added without the knowledge of the customer
Additionally, a landmark ruling in 2017 meant that even if the PPI policy was correctly sold, if the commission payment to the lender was over 50% of the overall policy cost, customers could claim compensation
How much is PPI compensation worth?
This all depends on
- The amount the policy was worth and
- The length of time the policy was taken out for
The Financial Conduct Authority’s guidance is:
“If we think you’ve done something wrong, we’ll explain how we think you should put things right. This usually means putting the customer in the position they’d be in if they hadn’t taken out the policy. We’ll also tell you to add 8% interest on top of any compensation if your customer has been out of pocket.”
Basically, whatever you paid out to the lender in PPI payments (including any interest accrued) should be paid back + 8% interest.
How much is still to be paid out?
This of course depends on who calculates this figure, but it is estimated to be at least £30bn left, even though in the past 10 years since the start of the scandal over £30bn has been paid out so far. With such a short amount of time left to claim, there will be a very small dent made in the £30bn.
How do I claim?
Of course, you can start your claim with us simply by contacting us or by calling our specialist team on 01270 446611 or you can go direct to your lenders yourself. There is also help from the Financial Conduct Authority.
Whichever way you start your check for PPI, we urge you to do it now and not leave it right up to the deadline – phone lines get busy, web sites crash, post gets lost!