Is the end in sight for claiming back Payment Protection Insurance? The Financial Conduct Authority (FCA) are considering a deadline in 2018 for the mis-selling of Payment Protection Insurance (PPI) (3), but is this in the public's best interest?
PPI is a type of insurance set up to help customers repay credit agreements if they ever become unemployed, sick, have an accident or pass away. Although it sounds like vital cover, it may not have been necessary because of hidden clauses that resulted in the insurance being invalid.
Unfortunately one of the main reasons PPI became such a huge scandal is because even when customers didn’t want the cover, lenders may still have added it without their knowledge or consent. In some cases, customers were led to believe that it was a condition of the credit agreement that PPI was purchased in order to obtain mortgages, credit cards and loans.
To date the banking industry has set aside over £24 billion to compensate those affected by the mis-selling of PPI, however now the FCA is considering whether or not to introduce a deadline for making claims before spring 2018. A deadline would make no difference to consumers who have already recovered compensation. However those who haven’t or are unsure about claiming, could only have a possible two year limit to claim back any compensation that they may be due. Over £24 billion has been set aside for a reason, could some of that money be yours?
In October 2015 the City Watchdog expressed that it would consider bringing in a deadline in 2018. There were also a headline in November 2015 that stated “18 financial firms who receive around 90% of PPI complaints, would have to set aside £42 million for a campaign to make others aware of a new two year deadline”. (1) Research conducted by the FCA found that out of nearly 15,000 people they helped, 74% of people knew what PPI is, but felt because of the “open-ended nature” of claiming they hadn’t got around to it yet or were putting it off.
Consumer group are rightly very concerned at peoples’ rights to compensation being time-limited. Martin Lewis of moneysavingexpert.com stated - “It’s disappointing the FCA has chosen to put a hold on PPI reclaiming even after many warnings of the danger. How can they argue this is being done to protect consumers when the uphold rate at the financial ombudsman is still over 70 %” (2). To refer a complaint to the Financial Ombudsman Service (FOS), consumers would first have to submit a complaint directly to the lender. Then if the consumer is unhappy with the outcome, they are entitled to refer their complaint to the FOS.
Here at EMCAS we know that PPI was not necessarily something you would have taken out willingly or knowingly, unfortunately even if you declined it, you could still be affected. Just over six months ago Lloyds Banking Group were fined a record breaking £117 million for dealing with their PPI complaints incorrectly. They were found to have told some customers they didn’t have PPI and weren’t due compensation, when in reality they did. They were also found to be under paying compensation to their customers by way of a settlement rather than the correct amount their customers were owed.
At EMCAS we’ve been dealing with financial mis-selling claims for over a decade now and we understand that some people would rather try and make a claim themselves. However, if your car was to breakdown you could fix it yourself but you may choose to go to a garage for that extra help and professional service, this is no different. You are perfectly entitled to make a claim yourself or you could seek advice from the experts in the field and get a professional service.
We always work to get you back all of the money you could be owed. All we do is a simple assessment over the phone, following this the process for you is very straight forward. With certain lenders all we need is your name, address and date of birth which means paperwork isn’t required.
If you would like to talk to one of our experts today, you can request a call back on here or call us direct on 0800 0934 309. As well as PPI, our experts are also trained to deal with a whole host of potentially mis-sold financial products including Savings and Investments, Pensions, Packaged Bank Accounts and Endowment Mortgages.
If you have any questions at all, please don’t hesitate to get in touch.
1. PPI claims deadline likely to be in 2018 but financial firms who mis-sold it will have to fund an £42m awareness campaign first- Daily Mail
2. PPI claims deadline could be set for 2018, regulator says- Independent
3. PPI payout deadline considered by regulator- BBC News