With the increasing barrage of telephone calls and TV adverts, people who have previously purchased credit financial products are pushed towards re-claiming their Payment Protection Insurance, or PPI, using high commission PPI reclaim companies. For those want to use a commission free method you could reclaim the PPI for yourself.

With a few easy to download forms and a small bit of guidance we can take that first step together; so you can send off your own PPI reclaim forms and keep every penny of what you might be owed. You don't need to pay your money to PPI reclaim companies.

The Background to Payment Protection Insurance

Payment Protection Insurance was a product developed that pays out against your credit repayments if you fall sick, get made redundant or other mishaps. There are variations to the many products on offer and so your particular PPI might vary; but a combination of sickness, accident and unemployment would feature on your PPI cover. 

Dollar Signs(108031)Credit: clker.comPayment Protection Insurance also did not always be known as PPI. Some companies use different names to make sure that it was not obvious; financial advisors were often pressured into selling these hugely profitable policies and they in effect became high-pressure sales advisors. Consumers have become more savvy to this in recent years, but further than simply not buying the products they are even claiming back money for products they have already purchased.

Dozens, if not hundreds of PPI Reclaim companies appeared on the scene, happy to take 30% or more to claim the money on your behalf, filling in the same forms that you do and paying the same rate of postage. The financial benefits for this are huge for these companies and some resort to equally dubious tactics to PPI selling to help you reclaim it; but if you can do it yourself, why let them take up to thousands of pounds of your hard earned cash?


PPI: Did You Sign Up?

In many cases, bank loans, overdrafts or credit cards will specifically state that Payment Protection Insurance is charged (monthly, annually, single payment; it does not matter). As already mentioned, PPI could be called a number of things on your specific financial product; "loan cover", "loan care" (I reclaimed £4,500 back from Nationwide for Loancare), "accident cover", etc.

In all cases, it should refer to a seperate charge somewhere in your paperwork if you have a variant of payment protection insurance on your financial credit product. 

Is your PPI for a "bad debt" or under a debt management plan?

That does not matter. Even if your credit card, loan or overdraft has been closed within the last 6 years, you are still entitled to claim if the Payment Protection Insurance is mis-sold. Any account at any state of play is entitled to be claimed against; but it must be remembered that any payout for overdue debts or even some loans that are up to date, might be used against your debt rather than being paid directly to you.

It is also wise to note that financial institutions can not penalise you in any way for making a PPI claim. This includes charging extra on your account, changes to your terms and conditions; and they certainly can not simply close your account because you have started a claim!


PPI: Were You Mis-sold

There a number of distinct categories of reasons that you can distinguish as mis-selling when it comes to Payment Protection Insurance in the UK. This could have been because the staff who were "advising" you of the product were either unclear on the conditions themselves, more interested in getting a sale than doing it correctly, or deliberately trying to get as many sales as they could - regardless of legitimacy.

You were not "employed": 

If you were self-employed, unemployed, redundant or retired; PPI might not have been right for you because you would have been excluded from that benefit.

Your medical history:

If you were not asked to declare any personal medical history, or even if you were never asked; this could invalidate your PPI. As with all insurances, medical history is a deciding factor and not declaring it could be fraudulent if you then claimed on an undeclared existing medical condition.

Pushed a single product:

Your loan or credit card "advisor" might have only told you about their preferred supplier of Payment Protection Insurance. You may have only been told about a Single Premium insurance (instead of monthly) or not given full details of it (maybe because they are "all the same").

You might also have found that your lender thought you wanted the PPI anyway and simply added it to the paperwork for your loan. This would mean you were obliged to take the Payment Protection Insurance once you had signed the paperwork, or they told you that it was a condition of the loan or credit card.

Your lender's already been caught:

A number of lenders has already been fined by the Financial Services Authority for PPI mis-selling. Although many of them are retailers and not financial institutions you could still claim against them. Companies who have already been caught mis-selling Payment Protection Insurance can be easier to claim against and these include the likes of Alliance and Leicester (now part of Santander) and Egg Banking (now part of Barclay's).

PPI: What You Need to Reclaim

In order to start your Payment Protection Insurance claim you need a number of things for each account, loan or card you are going to be claiming against:

  • Your Account Details: If you do not have your account number, it might be possible to simply contact your lender and ask them. They might refuse so you can also find these on your credit report - available from Equifax or Experian - or ask for all information held on you to the lender. Lenders are permitted to charge you £10 to process requests, so try Experian first (£2 or free with a trail to their credit management service).
  • The Financial Services Ombudsman questionnaire

  • The Money Saving Expert guide to completing the questionnaire 
    The MoneySavingExpert website is a great way to keep your finances in better shape. This guide was prepared by them to help PPI claimants. 

Processing a PPI Claim

To process a claim for Payment Protection Insurance is now really easy. Fill in the questionnaire above, using tips from the Money Saving Expert guide. If you are not sure what you need to put on your form, there are template responses in the guide that cover most eventualities and allow you to be honest about the reasons you were mis-sold Payment Protection Insurance without having to worry about whether what you have written is what you wanted to say.

You then have to send the questionnaire (but not the guide) to the lender that you want to claim the Payment Protection Insurance payments from. There are time limits that lenders have to adhere to in order to respond to your claim and they have to respond within 8 weeks; even if it is to say "we need a few more weeks because we are a slow and incompetent bank".

You lender can reject or ignore your claim. This means that you would need to start threatening the lender with a visit to the Financial Ombudsman, which is a whole new game that you play with your PPI mis-selling lender.