Payment Protection Complaints
Statistics released by the Financial Ombudsman Service have revealed Payment protection insurance was the most complained about insurance cover for the year ending 31st March 2011. 83% of the total complaints received regarding insurance related to payment protection cover in comparison with just 4.5% for motor insurance.
Payment Protection insurance is designed to insure a borrower’s repayments against loss of employment as a result of accident, sickness or involuntary unemployment. The cover has become notorious; however, as it has been frequently mis-sold with 104,597 payment protection complaints being submitted to the Ombudsman in the year ending 31st March 2011. The figure was a rise of 113% from the previous period. This dramatic rise occurred largely as a result of the judicial review into new FSA guidelines regarding the sale of PPI. While the decision was pending, many lenders opted to place payment protection complaints on hold. This entitled a significant number of unhappy customers to refer their complaints to the Ombudsman for review. The review was completed in April 2011 and lenders have now begun to examine new complaints. It is likely, therefore, that significantly less complaints will now need to referred to the Ombudsman.
The reasons people choose to submit payment protection complaints vary, but in most cases customers feel they were sold a policy they didn’t really want or need and, in some cases, that they could not use. If you feel that you were mislead with regard to your payment protection policy cover, were given incomplete or incorrect information you may be entitled to make a claim. Similarly if you didn’t need the policy because you were in secure employment, e.g. the armed forces, or had a policy in place elsewhere. If you were aged sixty-five or over or were self-employed at the time you were sold your policy you should also take a careful look at your policy terms as most PPI policies do not cover people in these circumstances.