Why You May be Entitled to Compensation for PPI on a Loan
There are many credit consumers who may be entitled to a loan PPI refund without even knowing it. For many years, banks, credit card companies, car showrooms and even High Street stores have been guilty of mis-selling PPI alongside credit agreements – sometimes hiding the premium for a PPI policy within the amount of a loan, or telling consumers that their loan was “protected” – without mentioning the nature of the protection or the cost of the insurance.
Some consumers were coaxed into buying PPI policies without ever knowing that the sales techniques used to sell the insurance product were non-compliant, while others were led to believe that they would not be accepted for credit unless they had the protection of a PPI policy (1.3 million consumers according to a Which? Magazine survey).
This article provides details of the most common ways in which PPI was mis-sold on loan agreements, the unethical practices that have been employed to avoid refunding consumers, and where you can find out more information about claiming compensation for PPI on a loan. If, after reading this article, you still have questions about your eligibility for a loan PPI refund, please do not hesitate to call out financial claims helpline and speak with one of our helpful advisors.
Were You Mis-Sold PPI on a Loan?
Not every PPI policy on a loan was mis-sold, but – according to Which? Magazine – one-in-three are worthless. According to further Which surveys, more than two million consumers have payment protection insurance on a personal loan that they will never be able to claim against and, in 2009, it was calculated that consumers are paying £1.4 billion each year more than necessary for their loan protection.
The reason for consumers paying £1.4 billion more than necessary is because highly incentivised sales advisors rarely told consumers that PPI was available from other providers. If they had, and a cheaper PPI product was available elsewhere, the sales advisor would probably have lost the sale. The fact that consumers were not advised that alternative insurance providers existed is the leading reason why you may have been mis-sold PPI on a loan.
Other reasons include:
You were not eligible to receive the benefits of PPI
If you successfully applied for a loan and were sold PPI when you were a student, a housewife, a pensioner, self-employed or in full-time employment with an occupational sick-pay scheme, you would not have been eligible to receive the benefits of PPI and you were mis-sold PPI on a loan.
It was implied that PPI was compulsory
As mentioned above, 1.3 million people agreed to payment protection insurance after it was implied it would improve their chances of being accepted for a loan. Many more were informed that PPI was compulsory and that they had to have it or would not get the loan.
Nobody asked you about any pre-existing medical conditions
Nearly all payment protection insurance policies have exclusions for certain medical conditions. If you were not asked about any pre-existing medical conditions, the sales advisor selling the PPI policy would have been unaware of whether or not you were eligible for the benefits of the policy.
The life of the PPI policy was shorter than the period of your loan
If you were sold a PPI policy which expired before the term of your credit agreement you will be entitled to compensation for PPI on a loan – even if you successfully made a claim against the policy while it was still in existence.
Bearing in mind these reasons for the mis-selling of PPI, it is not surprising that so many consumers are entitled to a loan PPI refund. A consumer in financial difficulty is unlikely to question the terms and conditions of a loan agreement in case they risk having their credit application declined.
How PPI claims work
Our process is really easy and we are here to guide you every step of the way…
Call or fill the form
One of our friendly helpful advisors will speak to you, with no pressure or obligation to proceed with a claim.
We check if you had PPI
We don’t need account numbers, just the lender name. Don’t worry about lost paperwork, we can still check for you.
We process your claim
You receive your cash £££!
Have You Received an Inadequate Loan PPI Refund?
In addition to mis-selling PPI on loans, banks and other credit providers have not been entirely straightforward when it comes to calculating the amount of a loan PPI refund. Financial claims specialists have estimated that as many as a quarter of claims for compensation for PPI on a loan have been underpaid due to the failure to include fees and charges in the calculations of compensation and due to a practise known as “comparative redress”.
“Comparative redress” is the practise of paying a loan PPI refund where the only the difference between the cost of a single-premium PPI policy and what the consumer would have paid in monthly premiums is refunded. Comparative redress makes the assumption that the consumer would have agreed to a monthly-premium PPI policy on their loan – irrespective of whether it was appropriate for them or not.
Consequently, if you have already received a loan PPI refund, you may be entitled to further compensation for PPI on a loan. In August 2014, the Financial Conduct Authority ordered the re-investigation of more than 2.5 million claims for a loan PPI refund, and there is a high likelihood that many consumers will be entitled to further compensation for being mis-sold PPI on a loan.
Find Out More about Compensation for PPI on a Loan
If you believe that you have been mis-sold PPI on a loan and would like to find out more about claiming compensation, you are invited to contact the injurycompensationlaw.co.uk freephone claims helpline and speak directly with one of our helpful financial claims specialists.
Our specialists will guide you through the process of establishing whether you can claim a loan PPI refund, and – if you are eligible for compensation for PPI on a loan – will explain how to recover the full amount you are entitled to, including 8% statutory interest.
All calls to our freephone claims helpline are completely confidential, and there is no obligation on you to claim a loan PPI refund once you have spoken with us. Should you subsequently choose to use our services, we operate on a “no win, no fee basis”, so claiming compensation for being mis-sold PPI on a loan will never cost you a penny.