FAQ: Payment Protection Insurance FAQ's
Different Occupations Affected By Mis-selling Payment Protection Insurance
Mis-sold PPI is something which many of us will have heard a lot about in recent years as many of those affected have sought compensation for their losses.
Despite the large number of cases which have been settled, there are still many cases which have not been lodged. The Financial Ombudsman Service (FOS), an independent body that handles some of the claims, forecasts that they will receive 285,000 new cases in 2012, with banks and PPI claim firms also likely to receive additional claims directly.
One of the reasons why there have been so many claims is because mis-sold payment protection insurance was added to a vast number of policies over the affected period.
Covering all forms of financial agreement, such as credit cards, loans and even mortgages, PPI was mis-sold on a grand scale. Factoring in the fact that many individuals may have taken out a credit card, loan and mortgage over this time period it is easy to see how the number of claims has spiralled out of control.
The mis-selling of payment protection insurance occurred through various routes, with some individuals being fed false or misleading information whilst others were simply unaware that the insurance had been added.
The situation surrounding this is not only considered serious because individuals were paying for a product which they didn’t necessarily need or want, but is intensified by the fact that some individuals were paying for a policy that they were not even eligible for.
PPI is designed to cover the repayments of a loan or credit card in the event that the borrower is unable to do so – due to illness or unemployment. However, as with all policies, there are certain stipulations and limitations on this cover and this is where many people were misled.
Certain occupations, such as being self-employed or working in positions which are classed as “high risk” would have meant you were not eligible for payment protection insurance cover. This means that anyone who was employed in these positions when they took the agreement, and PPI, would have been unable to claim had they have been out of work.
This means that they were paying for a redundant policy, spending money on something which they could not use. As it was often the lenders who misled borrowers into taking these policies they are the ones who are being held accountable – and that is why claims can now be lodged easily.
Any individual who was self employed or who worked in a high-risk job (or who may have been a student or retired) at the time they received a loan, credit card or other form of money lending agreement should review their documentation to check whether PPI was added to the policy.
If it was then the claimant could be entitled to compensation – especially if they were unaware that the PPI had been added in the first place.