Since the payment protection mis sold ppi scandal broke, hundreds of thousands of borrowers have found that they may have been caught up in the unethical sales practices of some lenders, resulting in potentially billions in compensation claims being raised against the lending institutions. In order to stand any chance of a successful compensation claim from your lender, you must first establish that you have been mis-sold on one of the key grounds.
Payment protection insurance is a kind of debt repayment protection in the United Kingdom in the form of PPI claims. Servicing debts can be one of the most crucial things that can seriously affect ones financial health. A few months of not being able to service debt repayments can have very severe consequences. This could lead to higher interest rates, accumulation of debt, and many other things that are very unpleasant. One kind of debt repayment is the mortgage. One of the worst consequences of failing to meet mortgage debt repayments is the foreclosure of the home, which no one ever wants to experience.
Mis Sold Payment Protection Insurance
For these reasons, people choose to protect their debt repayments so that they will not be accumulating debts that are very hard to repay. Payment protection insurance or PPI is an insurance product that covers peoples debt repayments in case they get sick through PPI claims, become incapacitated due to an accident, or get retrenched from work. The debt repayments that can be covered by the payment protection insurance include credit cards, mortgages, and personal loans like when people lease cars, appliances, and other home equipment.
When a policyholder is deemed incapable of repaying debts due to sickness and involuntary loss of job, the banks or insurance company will cover part of his stated debt repayments in the agreement. For example, if a policyholder makes a PPI reclaim within the active period of the PPI contract and if found eligible for a claim, the bank or the insurance company will then release an amount that is equivalent to its twelve months obligations to the policyholder.
If the policyholder needs to claim the policy, the first thing to do is to acquire proper documentation that will validate their PPI claim. For example, if one meets an accident on the road and is seriously incapacitated, he could acquire a police report on the incident as well as a medical report that states that the person is in a condition that prevents him from doing normal day to day activities.
If the policyholder wants to make a refund through PPI compensation claims, it is altogether a different process than making a claim. He or she must write a letter and send this to the bank or company responsible for the PPI insurance. The letter must state the reasons WHY a refund is necessary. These reasons must be based only on premises that imply that the insurer conducted fraud, misrepresentation, misinformation, or other reasons that make the transaction invalid. Policyholders can file a PPI claim if the banks or insurance companies sold them PPI while they were unemployed, retired, or if they already have a medical condition that prevents them from earning regular income. There are various other ways in which the banks mis sold PPI and not all of these are obvious.