Free, No Obligation PPI Check
What is PPI?
PPI is sold alongside loans, mortgages, credit cards and other financial agreements as a form of cover in cases of accident, sickness and unemployment where you can no longer afford to repay your lender. The principle seems very simple, if you were to lose your job or be unable to work, then the repayments to the loan / credit card / finance agreement would be paid by the insurer. Unfortunately, PPI was widely mis-sold and many customers were unsure they even had it.
Why did banks sell PPI?
For many years, PPI was championed by many trusted financial institutions for two main reasons.
Firstly, the cover meant that in extraordinary circumstances, the financial institution would continue to receive their monthly payment from the insurer and as such would not have to deal with the issue of reduced or missed payments.
Secondly, they were paid huge commissions from the insurer for selling the policies. Some of these policies were charged at the outset and included within the credit agreement which meant the bank would even charge interest on top of the cost of the policy!
Why did PPI mis-selling occur?
As the policies were so profitable to the companies selling them, many banks sold many millions of these policies which were either not explained to or not appropriate for the consumer.
People bought these policies from sales staff, because they thought they were getting good advice. They weren’t. In fact, the sales staff were heavily incentivised to sell these products and in some instances were encouraged to take any steps necessary to sell policies that would not protect the people they were supposed to help.
Why is a PPI Policy mis-sold?
The reasons for mis-sale are numerous and can relate to something the salesperson said or did not say, to something that was not illustrated in any documentation provided or in the product itself.
Many policies contained certain exclusions and would not provide cover if you were self-employed or had recently started work - in these instances the policy would not be appropriate.
Similarly, many employers offer sickness pay as part of their contracts of employment (this is applicable to many public sector workers). Accordingly, if you would not have lost income had you been off sick then this product is likely to have been unsuitable.
Many consumers were told directly that taking the insurance would improve their chances of being eligible for credit and others were told that taking the insurance was actually a prerequisite of being able to borrow. Neither was true.
Reasons for mis-sale
It is impossible to detail every possible criteria for mis-sale (as the reasons are for too numerous) but here is a list of the most common reasons:
- Self-employed at the time the policy was taken.
- Within a probationary period at work.
- Had an existing medical condition.
- Didn’t ask for the policy.
- Was told the policy was essential.
- Was told that the policy would increase the chances of getting credit.
- Was not advised that another policy could be taken out elsewhere which would potentially be cheaper.
- The full exclusions and limitations were not discussed.
- The full exclusions and limitations were not covered in the documentation.
- A full breakdown of the cost of the policy was not provided.
These are but a few of the possible reasons for mis-sale. In addition to these there are numerous reasons which will be dependent on the specific lender, when the policy was taken out, how the policy was taken out and your own circumstances at the time.
For your FREE PPI Check either click the Start Claim button or contact us on 0800 849 5078.