The different ways you could have been mis-sold PPI
For some people PPI (Payment Protection Insurance) has been incredibly welcome when an accident, illness or redundancy prevented them from covering their credit payments. Like any insurance, the right policy can make a world of difference if you need to protect something you value. Unfortunately, the more time passes the more it becomes clear the extent to which the UK public has been mis-sold PPI. In fact, the sheer number of different ways you can be mis-sold PPI is staggering. This two-part article discusses some of the many ways lenders can disguise their true intent – to sell PPI at any cost. Could you have fallen victim to their games and been mis-sold PPI without even knowing it?
1. Not knowing you had purchased it
Are you one of the people who will look back on a loan agreement and discover PPI has/had been added without your knowledge? In some cases, you may have been very firm in saying no to PPI yet it still ended up on there. It will be up to the lender to prove you agreed to the insurance, so if you can't remember being asked or are positive you declined the insurance and it has still been added, chance are you have been mis-sold PPI.
2. Slipped into the conversation
This is a naughty tactic. The lender will say something like “the fully protected cost of the loan will be £XXX per month.” Your ears are straining to hear the repayment amount and you think nothing of the phrase “fully protected” which is lender-speak for PPI will be added. They never refer to ‘fully protected’ again or explain what it is, and never mention PPI. You go ahead and take the loan. Chances are you have just been mis-sold PPI.
3. You are told having the lender’s PPI is compulsory
A lender is within its rights to insist you have PPI to cover payment of any money it loans to you, but it is not within its rights to insist you have to buy it from them. The Banking Code protects your rights to shop around and find the best value for money policy for your needs. Any lender that insists you must take out their insurance or you cannot have the loan has broken the law and mis-sold PPI to you. A good rule of thumb to follow for PPI is never buy from the lender who you obtain credit from or you risk paying way above the odds, in some cases as much as ten times more per month than the cheapest suitable policy on the open market.
4. Pre-filled applications
After talking to you on the phone, many lenders send out a pre-filled application form for “your convenience.” It’s not. It’s to make sure they can pre-tick various boxes on the form in the hope you won’t notice when you sign. PPI is one of those boxes that will often have a pre-filled tick, even if you make it clear on the phone you do not want PPI. If this happened, you have been mis-sold PPI. You should be especially vigilant if you fill out any forms at events or conferences, where the box could be ticked after you have signed and handed the form back.
5. Policy isn’t what you agreed to
Many people assume that when an insurance policy is sent to them, it will contain all the relevant information discussed on the phone with the lender or offered through the lender’s webpage. This is not necessarily the case. It pays to always be vigilant and read the policy and the lender’s terms and conditions carefully. Don’t be hurried into signing anything otherwise you could be mis-sold PPI.
Only around 1 in every 5 claims made on PPI are successful. That’s because most people do not realise the limitations their PPI policy may have or have simply been mis-sold it. It really does pay to check over all of your loan documentation to make sure you a) don’t have PPI you haven’t agreed to and b) if you do knowingly want a policy that it suits your needs. For more advice on how to reclaim your money if you believe you have been mis-sold PPI, call one of our team of PPI Reclaim Advisors on 0800 043 2027 or for a free call back use our call back form here.