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Grounds for PPI Compensation

Do you have a mis-sold PPI claim?

Mis-selling of PPI policies has been rife - there are a variety of situations in which Payment Protection Insurance is not appropriate, but many banks chose to ignore this and push the policies on their customers anyway.

As such, there are a great many grounds for mis-sold PPI compensation, one or more of which may be applicable to you, allowing you to make a claim.

The most common reasons to make a PPI claim are:

1. You were aged under 18 or over 65 when the PPI was sold to you. PPI policies have age restrictions. The insurance should not be sold to people outside of these age ranges.

2. You worked less than 16 hours a week when the PPI was sold to you. Part-time workers are not eligible for PPI coverage. The person selling you the policy should have enquired about your employment situation.

3. You were employed on a temporary or contract basis when the PPI was sold to you. Temporary or contract workers are not eligible for PPI coverage. The person selling you the policy should have enquired about your employment situation.

4. You were self-employed when the PPI was sold to you. PPI policies with unemployment protection are usually not applicable to those who are self-employed. The person selling you the policy should have enquired about your employment situation.

5. You had an existing illness when the PPI was sold to you. Pre-existing conditions are likely to void the policy if your illness should worsen leading to a loss of income. In these cases, you should not have been offered the insurance.

6. You were not informed that the PPI policy would not cover conditions such as stress and backache. Mental health issues, such as stress or depression, and common muscular problems, such as backache, are often not covered by PPI policies. This should have been explained to you when you were offered the policy.

7. You were aware you may become unemployed when the PPI was sold to you. If you had reason to believe that you were facing an imminent loss of income, then you would have been ineligible for insurance covering this event and should not have been sold PPI.

8. You were not told about the cost of the insurance (or not told you were buying it at all). The lender should have clearly explained the cost of the policy and gone through it with you in detail.

9. You were not asked about any other insurance, similar to PPI, that you may have already been covered by. Some insurance policies provide income protection, or you may have been covered by a scheme from your employer. The lender is obliged to look into whether you are already covered.

10. You were told that the PPI was necessary for you to get the loan. PPI is an optional purchase, and does not affect your eligibility for a loan or the interest rates payable. Lending institutions are not supposed to offer a discount if you take out an insurance policy.

11. You were not told that the same policy could potentially be bought for cheaper elsewhere. Many of the PPI policies available directly from lenders are pricier than if you purchased PPI elsewhere. You are meant to be given the opportunity to shop around before you take out a policy.

12. You applied for a loan online where the box for PPI was automatically ticked. Prior to July 2007, many online loan applications had a tick-box to indicate whether you wanted PPI or not. In a large number of cases, the page loaded with the box pre-ticked, so that customers had to opt out of buying the insurance rather than opting in. This was changed after concerns raised by the Financial Services Authority.

If any of these apply to you, then you probably have a valid claim for a full refund for mis-sold PPI.

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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