PPI Compensation FAQ

Q. What is Payment Protection Insurance (PPI)?

A.- PPI is a product sold by credit lenders to provide you with protection should an unforeseen change in your financial circumstances leave you unable to meet the loan repayments. There are clear rules that finance firms and lenders must adhere to when selling PPI polices. If you have taken out a policy and the seller didn’t stick to these rules then you may be entitled to compensation.

Q. Why can I claim back my Payment Protection Insurance Premiums?

A.- The Financial Services Authority has found that lenders have frequently been misselling PPI polices to their customers. If it was mis-sold to you then you can make a claim to get back the proportion of your monthly loan or credit-card payments that represented the PPI payments, plus interest.

Q. Have I been missold my PPI policy?

A.- There are a variety of circumstances that could mean you have been mis-sold Payment Protection Insurance.  These include but aren’t limited to –

• You were out of work or self employed at the time of taking out the policy.
• You were led to believe that you must take out a PPI policy in order to obtain the loan.
• You weren’t made aware that you could choose PPI from a cheaper third party supplier,
• The person who sold you the policy didn’t make you aware of any exclusions that may disqualify you from making a claim.

If any of the above applies to you then you may have a valid claim for compensation.

Q. When I took out my loan I was told I had to take out PPI, is this true?

A.- Payment Protection Insurance is in most instances optional, even though it is generally sold as part of a loan or finance agreement. PPI is extremely profitable to companies and large incentives are offered to staff to 'sell' these policies. If you have any doubts as to whether your PPI is optional we are happy to take a look for you.

Although companies that do make it compulsory to take out their PPI are not technically breaching any particular rules, they may be contravening of the Financial Service Authority (FSA) in 'treating customers fairly' or the 'acting in a fair and reasonable manner'. The UK banking code states that banks should not make customers take out their policies.

Q. I don't want my PPI anymore but my lender says I have already paid for it PPI as part of the loan and won't give me a refund?

A.- Single premium PPI or front loaded PPI (where you pay the whole amount of the PPI at the beginning of the agreement), is a possible issue for mis-selling in itself if the seller did not advised you that cheaper 'monthly paid' are available.

Q. Do I have to use Finance Reclaim to make my claim or can I do it myself?

A.- If you do not wish to appoint an agency, such as Finance Reclaim, to process your claim it is possible to initiate a claim yourself.

If you decide to undertake the work on yourself without the help of Finance Reclaim make sure you keep the insurer under pressure. If your claim is rejected you will need to take your claim to the FOS or FSCS.

Q. How can I claim compensation for missold PPI?

A.- To begin claiming compensation for your mis-sold PPI simply complete our online enquiry form.