About PPI

Court cases, and what they means for you?

In September 2011 the High Court dismissed a legal challenge by the banks, and this means that they must now go back over all their past sales of PPI (payment protection insurance) to see if customers have been mis-sold policies. And if they find that they have, where appropriate, they will write to those customers and invite them to make a claim.

This is the end of the legal process and banks must now get on with handling all PPI complaints and paying money back to customers, where appropriate.

Background

Since 2005 over 16 million PPI policies have been sold in the UK. PPI covers loan or mortgage repayments if you fall ill or lose their job.

owever many policies are believed to have been mis-sold either because they were unsuitable for the people who bought them, because people were led to believe that the policy was a condition of the loan or because they did not realise they were taking out the policy.

The Financial Services Authority (FSA) had told the banks to re-examine sales of PPI to see if they had been mis-sold. This led to a legal battle, during which time many complaints were put on hold. The court ruling and its acceptance by all the parties means that banks and other PPI sellers must now look at all past sales and, if there is any evidence of ‘systemic' mis-selling, write to customers and invite them to make a claim.

What does this mean for you now?

  • If you have a PPI policy but have never made a complaint
    This ruling does not mean that all past customers will be contacted directly, as not all policies were mis-sold in the first place. However, nothing has changed regarding customer complaints - you still have the right to complain about the sale of your PPI policy. In the first instance you should contact the firm who sold you the policy.

    The Financial Ombudsman Service (Ombudsman) has lots of useful information to help you do this, including a template to register a complaint about PPI which you can send to the firm that sold you the policy.

    So if you have any concerns at all about the sale of your PPI policy you should make a complaint now - do not wait for the firm to contact you.

  • If you have previously made a complaint but it was rejected by the firm
    If you have previously made a complaint but are not satisfied with the outcome or how your case was handled you can take it to the Ombudsman. The Ombudsman is a free, independent service for settling disputes between financial services firms and their customers. You must contact the Ombudsman within six months of receiving a final response from your firm.

  • If you have made a complaint that has been put on hold pending the court case
    If you have been waiting for a response, your firm should now get on and process your compliant. They should contact you shortly to tell you their next steps.

If you are unsure what to do, see the Ombudsman website.

Whatever your situation, get clear, unbiased information and advice from the Money Advice Service. If you can't find what you're looking for on our website or have a question about money, call one of our trained advisers on 0300 500 5000.

Disclaimer
News articles on this website are accurate, to the best of our knowledge, only at the date of publication. If the information they contain changes, follow-up articles may be published.

sourced: 12-10-11, Money Advice Service

success stories

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