Home Personal Finance Payment Protection Insurance – How to Obtain a Refund

Payment Protection Insurance – How to Obtain a Refund

by Dave

There are thousands of PPI claims management firms fighting for the consumer’s right to obtain money from mis-sold payment protection insurance, which may have been tied into mortgages, car finance, credit cards, and loans. If the consumer was unable to repay the loan agreement as a result of injury, unemployment, or illness, the insurer would fulfil its promise and make payments, but over previous years, it became clear that that banks and insurers mis-sold these policies under professional negligence.

If is relatively simple for a consumer to obtain the money they paid out through payment protection insurance, but there many management firms who will do the hard work for you. If the consumer believes that they were mis-sold PPI, the next step is to gather all of the paperwork and write to the bank or insurance company stating exactly why they feel that the policy was mis-sold. The majority of banks have refunded its customers for mis-selling PPI.

PPI Cover Not Explained Properly

All policyholders must understand the questions asked before signing the credit agreement because if the situation does not correspond with their circumstances, then the insurance will become invalid.

The PPI Policy was Overpriced

A large percentage of payment protection insurance policies were sold alongside credit cards and loans during the point of agreement. This means that the customer felt inclined to agree to the lenders cover. The familiarity of comparison websites has made it easier for consumers to find an inexpensive policy that covers for their exact circumstances, but PPI policies may have been overpriced at the time. In order to obtain the necessary loan, consumers were forced into taking out the PPI policy with the lender.

PPI Cover Not Needed

The lender should have asked if there was already insurance in place to cover the loan, in the instance that the credit could not be repaid due to illness, unemployment, or injury. This is common practice, so if these questions were not asked then you can sue for professional negligence.

The PPI Cover was Hidden and Already Within the Loan

Before consumers knew about the mis-selling of PPI, it was compulsory for lenders to include the PPI cover within the repayment of the loan. Many consumers were also told that the credit would not be given without the agreement to the payment protection insurance.

The Policy Became Invalid

If the consumer was unaware of what the policy covered, it was clearly mis-sold. Payment protection insurance immediately became invalid against self-employed persons, specific medical conditions, and age-related clauses.

Have You Entered Into a PPI Agreement Unwillingly?

In the past few years, if you have acquired any form of credit it may be worthwhile checking if you have signed up for payment protection insurance unwillingly. Many lenders did not disclose this to the customers and listed it only in the Terms and Conditions. This is clearly mis-selling as you always have the option to choose who provides your loan repayment cover.

If you are unsure and you do not have your original documentation, request a copy from your bank and state that you want this for your records. Do not mention that you want to reclaim on a PPI. If your loan is over six years old, the bank may have destroyed it, but there may be a copy still held in archives. It is worth noting that any loan agreement should have been returned to the consumer after it had been repaid.

Is it Better to use a PPI Claims Specialist or DIY?

There are two options that you can consider when reclaiming mis-sold payment protection insurance. One is to use template letters, and the second is to use a PPI claims management specialist.

If you decide to put a claim in yourself then it important to note that it may be time consuming gathering all of the relevant paperwork. If you provide a 30-day notice allowing the lender to respond, it is likely that they will only respond toward the end of the 30-day notice. Lenders can also be obstructive and even refuse to refund the damages. However, if you are successful then you get to keep 100 percent of the refund.

Using a PPI claims specialist takes away all of the stress in obtaining the paperwork and sending correspondence to the lender. If loan paperwork is necessary then they will pay for an information request. If you are successful in your claim then the PPI claims management firm will deduct a set percentage for their work.

Have you been mis-sold payment protection insurance? If so, why not reclaim the money you paid by using a claims management firm who deal in PPI claims?

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