Being such a major issue in the finance industry and affecting so many consumers over the past 25 or more years it is difficult to not be aware of the crisis which has been created by the mis selling of payment protection insurance policies.
This payment protection insurance scandal which is unprecedented in the total value and the number of people affected has severely dented the confidence the general consumer has in the banks and finance companies such as loan and credit card providers. It has also led to many changes in the operations of the banks and money lenders with the Office of Fair Trading and the Financial Ombudsman stepping in to outlaw some practices and develop new rules and regulations regarding the sales of such products and the importance of the duty of care which is held by the banks.
As well as the changes in the sales process and new regulations further steps have been created in order to rectify the problems that the mis selling of payment protection insurance policies has caused. The main one is the refunding of all money which was spent on payment protection insurance policies that were mis sold as a result of the sales team at the bank and finance companies. The process that is required to be completed in order for the consumer to get their money back is the PPI claims procedure and this alone has created a significant amount of discussion and interest.
As all consumers are unique in their circumstances and the number and value of the loans and other finance products that they took out an array of issues and questions has now resulted from this and surround the PPI claims process. It is therefore recommended that if a consumer was sold a finance product which often came with payment protection insurance attached such as a credit card, loan, store card, hire purchase finance or potentially, but less so a mortgage they should look into whether or not a policy was sold with their product. If a payment protection insurance policy was sold with their credit based product then it is essential that the customer looks at the way that they were sold the product, was it forceful? Not cover all of the essential information? Or simply the policy wasn’t suitable for the consumer and they did not meet the criteria that was set out to make a claim to get any repayments met.
Some of the way in which PPI claims differ across the population include the number of policies that a customer held and then value of each of these policies. The payment protection insurance policy cost was determined based on the value of the loan that the policy was sold to protect and therefore the higher the loan amount the higher the cost of the policy premiums and refund that can be expected. The actual rate of the cost of the premiums to the value of the loan varied throughout the industry and could be anywhere from 10% to 30% on average with some insurance providers charging more than this. Due to the huge variations across the board it is difficult to make an accurate estimate of the potential refund a claimant will receive if they do not know how much they paid for the policy. An approximate estimation can be made by working out the potential range in value that the claim could be worth or by using a payment protection insurance refund calculator.
The number of the amount of payment protection insurance policies that were held by one individual varies massively. Although one payment protection insurance policy would have usually covered other loans and cards depending on the conditions of the loan and the customer would not have needed more than one it still frequently happened. This was due to multiple reasons. Firstly, those who were sold policies without being aware of it would have not known how many policies they held and therefore would not have been able to inform any future sales people at the banks that they already had a policy. In addition those who were sold policies through tactics such as force would have probably not been asked by the banks whether or not they held policies in the past that may have still been active. All of these payment protection insurance policies have the potential to be claimed back, if the claimant chooses to make the claim themselves then they will need to contact each individual bank/policy provider. If services such as PPI Claims Management are used the claimant only needs to make one initial claim and the service will then complete claims from the remaining policies and therefore this is more efficient for the claimant.