Banks set aside millions for compensation claims
by Luke Whitmore, 31st May 2011
The banks are set to pay out vast sums of compensation for those
who were mis-sold PPI policies on loans.
The recompense will be granted due to the widespread mis-selling
of Payment Protection Insurance, intended to shield individuals
from a loss of income which could potentially lead to them
defaulting on their loan.
Unfortunately, PPI policies were pushed onto many people for
whom they were not appropriate, meaning those who would not ever be
able to claim on the policy, who did not ask for it or even were
not aware that they were going to be paying for it.
While financial institutions initially attempted to fob off
consumers who made complaints over these issues, recent FSA
regulations stated that they would be obliged to retroactively
apply new rules on PPI mis-selling, meaning that millions of
customers would be in line for a payout. The banks took the FSA to
court over this, but they lost their case and are now required to
listen to customers' complaints and offer redress where
appropriate.
The banks have since set aside billions of pounds for
compensation, with the estimated payout for customers who have been
mis-sold PPI growing day by day. It has hit the profits of the
financial institutions hard, but is good news for customers, who
may have been paying a large amount of money for a useless policy
which could even have been added to the loan under false pretences
or without their knowledge.
The reasons that a PPI policy may have been mis-sold are
manifold, but cases generally hinge on misleading statements from
insurance brokers or insufficient checks on the background of the
borrower, which may mean that the policy is not suited to them at
all and could never be claimed on. Customers are advised to check
if they may have been sold PPI inappropriately.
If you have been a victim of PPI mis-selling, we can help you reclaim PPI now.
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"I just had to put pen to paper and write to say I'm more than delighted with my settlement that you won me back from my PPI I had with Lloyds TSB. The Claim Forms were simple to fill in. It was a breeze"
Mr R Evans 11 Nov 2010