Protecting our home is a basic need during a recession.
The Financial services Authority (FSA) has fined banks and lenders for the mis-selling of Payment Premium Insurance (PPI) and for failing to treat their customers fairly. Payment Protection Insurance cover (PPI) is sold to borrowers to cover them against the risk that they may not be able to pay their monthly payment on a credit card balance, mortgage or personal loan; due top ill health, accident or redundancy. PPI has in the past been a major source of income for banks, finance companies and retailers .The commissions paid received would have been from 25% to 75% of the total payment for the protection policy taken out. This is outrageous!
Todate the following banks, finance companies and retailers have been fined:
- Capital One fined £175,000
- HFC Bank, (trading as Beneficial Finance & Household Bank) fined £1,085,000
- Alliance& Leicester fined £7,000,000 (million)
- Liverpool Victoria fined £840,000
- Egg Bank fined £721,000 recently
- GE Capital Bank fined £610,000
- Loans.co.uk fined £455,000
- Swinton Group fined £770,000
- and other retailers.
A whole reclaim industry has grown on the back of Payment Protection Insurance being mis-sold and anyone with a personal loan, car finance or a mortgage should check if they have a single premium policy as they could claim their money back.. Some companies have been ruthless in their sales techniques whilst others have just mislead customers into believing that they would not get their loan or finance agreed if they did not take out PPI protection.
Finance companies and Banks have been guilty of selling big chunky sized Payment Premium Insurance policies; usually around £3,000 to £4500 which they have then added to the mortgage, finance or personal loan agreement. The payment for the PPI cover would then be added to the initial loan amount. This would increase the amount borrowed by a few thousand pounds and finally Interest would then be charged on the entire life of the loan. Outrageous!
The Competition Commission would like banks, finance companies and retailers to stop selling PPI policies for 14 days after the finance was arranged. In early October last year the Financial services Authority (FSA) said it would be stepping up its action over the mis-selling of Payment Protectio Insurance (PPI) in the future. It is little wonder that Royal Bank of Scotland, Nat West Bank, Barclay, Lloyd Banking Group, Alliance & Leicester, and the Co-Operative Bank have announced that they intend to stop selling single block Payment Protection Insurance (PPI) with personal loans by the end of January. The FSA now hopes that other firms will follow the lead of the Big Banks and cease selling Payment Premium Insurance (PPI).
In view of this announcement by the banks to withdraw PPI you should consider Mortgage Payment Protection Insurance (MPPI). Protecting our home is a basic need during a recession especially one with so many uncertainties. If we are made redundant we still need money to pay our mortgage and bills for 13 weeks or three months under the new initiatives recently announced by the government before we qualify for their help and assistance.
Almost all of us harbour fears of being made redundant; we are concerned about how we would pay these bills and commitments and we fear repossession of our homes. Mortgage Payment Protection Insurance can help to protect our mortgage payments, personal life insurance and your building and contents insurance for up to 24 months if you cannot work due to unemployment or suffer a disability. We can have these policies set so that they pay out after thirty days back to day one. The Council of Mortgage Lenders is now encouraging all mortgage borrowers to consider the advantages of taking out independent mortgage payment protection insurance (MPPI). For external reviews and comparisons, please take a look at Income Protection Insurance.
Do you already have a PPI or Payment Protection Insurance cover in place and was it mis-sold to you? To check if you may have a claim for mis-selling and to buy a guide to reclaim PPI compensation then follow the link for further information.
Your thoughts, experiences and comments are always welcome. You can join the discussion below by leaving your comments.
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What people do not realise is that they can often purchase stand alone ppi a lot cheaper than if they had gone directly through their lender. Paying upfront for a PPI policy means that they also pay interest on top of these premiums which can be quite substantial.
I’m glad to read this post. Finally I understand this subject clearly now. Keep update and i will come regularly to check your post in this site. Thanks
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What are the risks involved in terms of dealing with an insurance website ?
I found your blog from one’s of the bookmarking sites. It’s so interesting to read your post. I will regularly check your site. Thanks
I found your blog from one’s of the bookmarking sites. It’s so interesting to read your post. I will regularly check your site. Thanks
Insurance is a matter of a high privacy and the recent idea of having the government interfering into it does not look so good.
I’m seldom to write a comment from a post that I read. But this article is really good so i can’t just leave this site without giving this comment.
[...] my credit card provider for a compensation claim for mis-selling. I believed that I had been mis-sold a Payment Protection Insurance policy which was suppose to protect my credit cards payments if I fell ill or was made redundant. I [...]
I found your blog from one’s of the bookmarking sites. It’s so interesting to read your post. Usually I don’t like to make a comment, but I can stop my self to made a comment here. I will regularly check your site. Thanks
I’m seldom to write a comment from a post that I read. But this article is really good so i can’t just leave this site without giving this comment.
Hey, I really enjoy your blog. It’s always entertaining what other blogger have to say.
Such a wonderful website that you have!
I think selling your property quickly is another option and a fast way of releasing the cash you need to aviod repossession.
This is fascinating, I wished you posted frequently about Payment Premium Insurance (PPI) will be axed by the big banks | Talk Money blog!
been visiting ur site for three days. really enjoy your posts. by the way i am doing research relating to this area. do you know any great websites or maybe online forums in which I can get more information? thanks in advance.
There needs to be more info about PPI and people need to realise that they don’t have to buy it from the loan provider.