Are you entitled to a share of £20bn Compensation?
Have you ever had a loan, credit card or mortgage?
Did you know that you could be paying extra money for unnecessary insurance fees?
Are you aware you can claim these fees back?
To date £20bn has been paid back by high street banks to customers, like you, who may have been paying unnecessarily for PPI. The time is however running out if you want a slice of the money.
What is PPI?
Payment Protection Insurance (PPI) is a form of insurance that is attached to a finance product. This is to cover the borrower in the event they are unable to make a payment due to sickness or unemployment. PPI is supposed to act as the cushion for people when they are in a finance agreement should their circumstances change. The premium is either paid in a lump sum up front or is included in the monthly payments. Sounds good, doesn’t it? But the reality is something different…...
The era of ‘mis-selling’
The late nineties and early ‘noughties’ was when PPI mis-selling was at it’s most aggressive with some lenders deeming PPI as ‘compulsory’ in order for customers to be accepted for the loan or finances. The period also saw the trend of sub-prime mortgage companies adding the premium on to the finance without the customer knowing. That, teamed with the very tight structure set out to limit the amount of people who could actually make a claim on the insurance made the PPI market work completely in the banks favour. Many customers simply went along with the flow and agreed to the policy having no idea what it was and what it actually covered. For many, the cover was actually useless. An example of this is that self-employed people did not receive payments for time off work as the typical policy did not cover this.
Unlucky for lenders, in the mid ‘noughties’ things changed. This is when the Financial Services Authority (FSA) being the then regulator of the financial services market took charge of the insurance sector. The FSA realised that this type of product was frequently mis-sold and for many was an expensive and unnecessary purchase. The FSA ruled that the conduct of the banks had been wrong and demanded they refund customers who had been ripped off.
The battle-lines were drawn. Banks and other lenders were banned from selling ‘single premium’ policies and strict sales guidelines on how, when and to whom policies could be sold were imposed. Many banks campaigned against the rulings and deemed them too harsh to follow. In truth, the banks were just trying to preserve their profits. Court cases followed, but ultimately the consumer won and the banks lost. The eventual outcome was that banks were instructed to revisit old PPI claims and to review all their customers to identify those entitled to compensation for being mis-sold insurance.
The perks of being a ‘good salesperson’
Nine years on from the date this scandal first started to break, the spotlight today is upon the amount of commission sales representatives received for selling PPI policies. We now know that the majority of what was paid by the customer was for the representatives’ commission, in some cases being as much as 80% of the total premium paid.
These latest revelations about excessive commission levels have dragged the banking industry back to Court for another bitter battle. The Court ruled in favour of consumers once more, directing that refunds should be made where the commission element of the premium was over 50%. This ruling, which comes into effect on the 29th August 2017 means that even if you have had a refund before, you could receive a further refund for the amount paid over the 50% commission mark.
The end is near!
Although it is good news about the commission refunds, an end is near to the time when you can actually bring any claim for compensation. The cut off date is the 29th August 2019. This is the last day it will be possible to bring a claim. In the circumstances, the best advice given to customers who have still not made a claim is; THE TIME IS NOW! Take full advantage of the opportunity whilst you still have it. The banks have set aside many hundreds of millions of pounds to pay for these claims. If you fail to claim before the cut off date, then the opportunity is gone forever.
What can I do now?
In a lot of cases, customers won’t put in a claim with the banks as they feel it is too time consuming or the banks won’t listen. In today’s society, we are all in a rush. We know we can claim independently but we just don’t get the time. Why wouldn’t you want to do this when the banks have set aside money to pay you and this is your right? You could be missing out on a substantial sum of money.