PPI Facts and Figures | Payment Protection

What is Payment Protection Insurance?
Payment Protection Insurance is also known simply as PPI, a form of insurance cover that is designed to meet repayments on finance for a set period of time in the event that you are unable to pay due to sickness, accident, or redundancy. This type of insurance is offered with finance such as loans, store cards, and credit cards amongst other things.

Why has PPI become such an issue?
It has been found that PPI has been mis-sold by many of the UK lenders. In most cases the lender failed to properly provide details of the PPI, so the borrower took out the cover without actually knowing what it was really for. In other cases the cover was sold to borrowers that couldn't really use it. In a number of cases the cover was simply added to the loan without the knowledge of the borrower. This is called a single premium loan and PPI policy. In most cases this has been found to be extremely excessive and unnecessary.

How much does PPI cost?
The cost of PPI can vary depending on the type of finance you are taking out, the amount you are borrowing, and the company that "sells" you the PPI.
PPI is generally an expensive form of cover and can really increase your monthly repayments as well as the amount that you pay overall.

How many PPI policies are in force and how many claims are successful?
It is estimated that there are around 20 million PPI policies in force in the UK, which have been sold to consumers. According to the Office of Fair Trading only one in every five claims on PPI policies is actually successful.

I was told by a lender that I had to take out PPI to get the finance I needed. Is this true?
No. There is no obligation to take out this insurance with any particular company, including the company through which you are taking out finance. If you do want to take out this cover it is advised that you shop around to see whether you can get cover at a more competitive prices. Secondly, this is not a compulsory form of cover, and there is nothing to state that you must have PPI in order to get finance. Don't let the lender tell you otherwise.

I feel that my PPI policy was mis-sold to me. Can a make a claim for compensation?
It depends on a number of factors, such as the circumstances under which you were sold the cover, why you feel that it was mis-sold, and when the policy was taken out. With almost 89% of PPI policies thought to be mis-sold, chances are your policies were too. Contact us to see if a reclaim is possible.