Payment Protection Insurance
Payment Protection Insurance (PPI) is a phrase we’ve heard a great many times over the years, but what exactly is it? Basically, PPI was offered by banks and credit providers with great gusto from the early 1980s onwards. It was sold to consumers as a form of insurance that would help to protect them in circumstances such as the loss of a job or perhaps a long-term illness.
A variety of financial products came to be accompanied by the offer of PPI, including mortgages, loans, credit cards, store cards and overdrafts. Many were offered as a lump sum that was added to the loan itself, while in other cases it was based on a monthly payment. Needless to say, many consumers signed up to PPI because it only represented a relatively small outlay and of course because it offered a degree of protection against an uncertain future.
PPI policies were easy to sell at the time, in part because consumers saw them as a genuine safety net against unexpected events. The policies themselves were generally on a ‘one size fits all’ basis, so the exact same policies were sold to people of all ages, all backgrounds and all financial statuses. For the providers, this meant they were easy to sell, and cheap because it wasn’t necessary to offer staff much in the way of costly intensive training courses.
And, most important of all for the providers, the profit margins were huge. Commissions were extremely generous, and as a result PPI was sold with a high degree of enthusiasm. Many people and organisations made a great deal of money selling these policies before the sale of single premium PPI products was banned by the FSA in 2009.
A scatter gun approach that led to vast profits
By that time, of course, many millions of consumers had purchased policies that in many cases were unnecessary, overly expensive and in some instances weren’t even relevant to their circumstances. The year before the sales ban, it was estimated that more than 20 million PPI were in existence in the UK. For many of the providers, selling a packaged product on a seemingly scatter gun approach to as many customers as possible had been extremely rewarding.
Perhaps inevitably, things had to change. It became apparent that many of these policies had been mis-sold, and the result was a rapidly increasing number of compensation claims. Well over £30 billion has been paid out so far, and there are some in the industry who feel this is nowhere near the full amount as yet.
The clock is ticking on PPI claims now, with a deadline of August 2019 fast approaching. There are still many people who are victims of mis-selling, and they need to come forward soon before the door closes. These individuals may be able to claim compensation for the mis-selling, but they need to start the ball rolling soon.
Here at Beat the Banks, we have handled a significant number of successful compensation claims for mis-sold PPI, and we can make the process simple and stress-free for you. One call to 0800 193 1234 is all that’s needed to make a start, and our knowledgeable, friendly team will keep you informed right from the beginning.
When the door closes in August 2019, those who may have been due compensation and didn’t claim will no longer be able to see if they had a valid case. The banks and credit providers shouldn’t get away with these cases; the mis-selling of PPI is rightly regarded as a major financial scandal, so make sure you seek the justice you deserve. Talk to Beat the Banks today and let’s work together to right a wrong that perhaps should never have been allowed to happen.