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Payment Protection Insurance and Reclaiming PPI

The controversy around PPI refuses to die, with more than 3 million people claiming PPI reclaims. Let us take a look at what is Payment Protection Insurance - What are the instances of a PPI mis-sell, and what is the procedure for a PPI reclaim.

Payment Protection Insurance or PPI as it's popularly known is an insurance that's sold along with a loan, credit card or a store card. In an event of a situation where you are unemployed, invalid or death, PPI is supposed to cover the payment. It's also called Loan Protection Insurance.

PPI, although a good plan for those who are seriously worried that they might lose their job or might fall ill, has gained notoriety for being mis-sold. This means that people have been sold PPI's without knowing that their claims would be rejected if they were to apply for a reclaim. Also instances where people were misinformed that the PPI increases chances of the loan being approved, or instances where people never asked for a PPI, but it was nevertheless added to the loan or instances where you were not informed that there are other cheaper options of PPI.

People with a history of heart complaints, high blood pressure, diabetes or asthma are refused a reclaim on PPI. Also, people who are unemployed retired or self employed are refused a reclaim on PPI. Similarly, people above the upper age limit cannot reclaim PPI. There are many instances of people who fall under one or all of the categories are sold a PPI, even without informing that they cannot reclaim PPI. People who fall under this category can file a reclaim claiming mis sell. If you are one among those who have been sold a single premium policy, you should get a refund on cancelling the PPI. If the PPI is cancelled or the loan repaid early, but the PPI isn't cancelled, then a reclaim for a PPI can be made. Even if you weren't mis-sold the PPI, but had to face problems when cancelling the PPI, you could still apply for a reclaim claiming mis sell.

If you have been mis-sold a PPI, you can write to the bank or the lender that sold you the PPI, citing reasons why do you think that you have been sold the PPI. There are chances that the bank would refuse your claim saying that they have enough proof to prove that you were made aware of all the terms and conditions when you were sold the PPI. If the bank does not entertain your request you could speak to a claims management company or an attorney or even the Final Ombudsman to register a complaint against the bank.


The total amount through PPI reclaims could be anywhere around ÂŁ 3.2 billion, with the FSA issuing new rules to handle PPI mis-sell complaints.

How to claim ppi


payment protection insurance and reclaiming ppi