Major high street Banks and other financial service providers have recently offered a product called Payment Protection Insurance (PPI) to cover the consumer against the unforeseen lack in ability to repay a loan agreement.
Some consumers choose to purchase this product and Banks don’t have to offer PPI and they can allow a customer to select it without advising them on whether that particular product is appropriate for them, like a lifejacket that won’t keep you afloat if the ship sinks.
Banks can exploit PPI in a few ways and the most common is simply allowing the customer to select PPI, simply by ticking a box and this releases the bank from the responsibility to correctly sell a customer the right product. If that customer happens to be unlucky enough to need the PPI, the chances are they will not be eligible for the product they have paid for.
The cover they buy could insure them for the wrong value of their financial service and in most instances if the unforeseen does happen, they are not eligible for the insurance. This has left thousands of customers in financial ruin when not being able to pay back a loan after an accident or cover their mortgage when they have been made redundant.
A second method is much worse, by means of signing a contract a customer can be unknowingly accepting to pay for PPI when buying a financial service; this is likely to be complexly written into the small print thus avoiding any legal indiscretion.
This kind of scamming has accounted for almost 1bn profit for the UK banks in the last year and with the number of unemployed remaining high this figure is likely to increase. It has reportedly affected over 8000 families in the UK in 2009. Many families are seeking compensation to claim back their PPI payments.
Want to find out more about PPI Claims, then visit Dons LLP site on how to choose the best Mis Sold Payment Protection Insurance for your needs.
