Payment Protection Insurance (PPI)

PPI is an insurance policy which has typically been sold alongside a loan, credit card, store card, catalogue card, car finance and/or mortgages. It was designed to protect against loss of income, illness or other occurrence that might prevent you from making repayments.

Mis-sold PPI

Many such products were mis-sold to consumers over a long period of time. If you suspect you have been mis-sold PPI, you may be entitled to make a claim. An example of mis-selling involved some people being falsely advised their loan/credit card application could not be approved without buying PPI alongside it. In other cases PPI was added automatically without the consumer’s knowledge or consent.

The deadline for PPI compensation claims is 29 August 2019.

What should you do

You should check your paperwork for previous loans and credit cards to find out if you had a PPI policy. If you do not have the paperwork or are not sure whether you had PPI, you can ask the provider to complete a check for you, free of charge. You will need to provide them with your name, date of birth and current/previous addresses.

If you do not remember who your lender was, you can check your credit file from the three main credit reference agencies: TransUnion, Equifax and Experian.

There are a number of questions which you should ask yourself when considering making a claim such as:

  • How were you informed about PPI?
  • Was this sold as an optional extra or was it presented as a necessary add-on to your financial product?
  • Did you actually need it? You may have had adequate cover through other policies, employer benefits or sickness entitlements;
  • Were you were told about any exclusions such as age, medical conditions, country of residence , pregnancy at the time the policy was taken out or employability?

How to make a claim

Once you have established that you have been sold PPI you can make a mis-selling claim directly to your bank/provider. The Financial Conduct Authority (FCA) has a useful PPI consumer questionnaire on its website.

This form will help you record all the information you need in order to make a claim.

How long it takes

If you do not hear from your bank/provider within eight weeks, or you are not happy with the response you have received, contact the Financial Ombudsman Service (FOS).

Claims Management Companies (CMC)

A CMC may contact you to help with your PPI complaint, but it is important to note they normally take a percentage of any money you receive. It is therefore worth considering making the complaint yourself with the tools we have mentioned here.

For more information on about PPI, see The Consumer Council’s factsheet.