As soon as a person is struck by misfortune such as involuntary unemployment, accident resulting to his/her disability, Payment Protection Insurance or PPI, covers loan payments/repayments in case a person lost his job, or not capable to work because of sickness, accident and disability. PPI can come with almost any form of loan whether it be money loans, credit card loans or mortgage loans.
Loans that come with PPI ought to be beneficial to both parties (lender and borrower) because it gives lenders the profit they need to cover the debt and it protects and ensures borrowers that they will be covered by the insurance in case something unfortunate come to pass.
Sadly there are lots of reports where unsuspecting customers have been tricked or pressured into buying PPI at high costs or they don’t need. In the UK, thousands of people have made claims and complaints against their financial lenders because of fraudulent and misleading Mis-sold PPI insurance.
What are the grounds of a mis-sold Payment Protection Insurance? There are numerous circumstances on why a PPI is mis-sold. Others say that their banks insisted on purchasing PPI for the loans they took, if not they will not be approved for the loan. The truth of the matter is, PPI should be voluntary and should not be forced to someone getting a loan. Just like a car insurance, it is up to the customer whether he or she would get Payment Protection Insurance or not. Furthermore, it’s bad enough that people are forced to get unnecessary PPI, but it gets even worse if the insurance alone is over-priced or not declared to the customer.
Those who have existing health problems, unemployed, self-employed o retired are mostly not allowed to get PPI or covered under PPI claims. Therefore if someone sold them PPI knowing that the person they are selling it to is under any one of these circumstances, the PPI deal is null and void to start with.
In addition, the Fraud Act 2006 adds to the arsenal in favor of customers who have undeniable fact that they were mis-sold with PPI and wishes to do a PPI claim. Further good news is that England’s Financial Services Authority (FSA) and the Financial Ombudsman Service (FOS) have been diligent in prosecuting institutions with complaints from customers concerning mis-sold loan insurance claims.
PPI claims have helped people get back what is fairly theirs and have made examples of financial institutions who have violated the law.
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