The half-yearly complaints data report from the Financial Ombudsman Service has revealed that the uphold rate for PPI complaints has risen to 76%.
The Financial Ombudsman Service is an independent arbitrator when disputes arise between financial institutions and their customers. Every six months, the Ombudsman publishes a table which reveals how many complaints it has received about payment protection insurance and other financial products.
As has been widely forecast, the number of new complaints about PPI has declined considerably. However, against most predictions, the uphold rate for PPI complaints – the percentage at which complaints are found in the customer´s favour – has increased substantially from an average of 60% in 2014 to 76% in the first half of 2015.
The significance of the rise is that financial institutions have for a long time been accusing claims management companies of submitting speculative claims for PPI compensation. It was expected – according to the credit providers´ allegations – that the uphold rate for PPI claims would fall closer to 50%. However, quite the opposite has occurred.
One of the reasons for such a substantial rise in the uphold rate for PPI complaints appears to be that many customers of Clydesdale Bank have not waited for the company to complete its review of PPI claims – ordered by the Financial Conduct Authority last April – before contacting the Ombudsman with a complaint. The uphold rate for Clydesdale Bank PPI claims was 85%.
However, the high uphold rate for PPI complaints against the Clydesdale Banks was yet again dwarfed by units of the Lloyds Banking Group. The Ombudsman found in the customer´s favour in 93% of PPI complaints against Lloyds Bank PLC, in 86% of PPI complaints against Black Horse Limited and in 66% of PPI complaints against the Bank of Scotland – who, for the first time ever, became the leading source of new PPI complaints with 15,002 new cases accepted by the Ombudsman compared to 13,319 new PPI cases against Lloyds Bank PLC and 12,111 new PPI cases against Barclays Bank.Read More