The great PPI claims scandal takes a step nearer its conclusion as we have now passed the 100 days to deadline marker, but banks are still paying out millions of pounds a month on successful claims.
The PPI Claims Deadline is set for midnight on August 29th. Consumers who have not submitted a mis-selling complaint by then will have lost the right – and any potential compensation – forever.
Accurate figures are difficult to come by but the Financial Conduct Authority (FCA) believes around 64 million PPI policies have been sold over the last three decades, many of them perfectly correctly.
But millions were mis-sold to people who didn’t want them, didn’t need them or could never have made a viable claim on them if they needed to.
Many people were not even aware they had PPI because it was added after the deal had been concluded by unscrupulous sales staff.
It was also common practice that if PPI was sold on the first of a series of loans it would be added to any subsequent top-ups or rollovers without obtaining the customer’s permission.
It is impossible to say how many successful claims have been made because the banks and other lenders don’t publish that information, but experts have estimated somewhere around 15 million.
One figure that is published is the total amount of compensation paid by the UK finance industry since January 2011.
It currently stands at £34.4 billion and eight years down the line is still increasing at more than £¼ million a month.
The peak payout of £735.3 million in a single month came in May 2012, a year after the British Bankers’ Association lost a judicial review into the way claims should be investigated. The resulting publicity unleashed a torrent of complaints which is still continuing.
The FCA deadline awareness campaign has prompted many new claims from people who think they may have been mis-sold PPI but have no paperwork to back up their suspicions.
However, if asked, lenders are now required to examine their records to find out if ANY past agreement had PPI attached to it and notify the customer.
Concern has also been expressed that some banks are only investigating specific complaints and not looking at the consumer’s full history, thereby depriving them of potential compensation.
Consumer champion Which? cites a case for a Country Durham woman who complained about four specific policies which the bank investigated, but when she later asked them to investigate all of her agreements they admitted PPI had been attached to a further 13 rollover loans and paid her compensation of £12,784.
Most complained about
The Financial Ombudsman Service (FOS) investigates complaints where the bank and customer cannot agree and have just announced that PPI has become the most complained about financial product ever.
The service only investigates appeals on claims, but it still dealt with its two millionth case last year and 46% of all complaints they received were for mis-sold PPI.
In its annual review FOS said: “The deadline for complaining to businesses is 29 August – but we’ll be dealing with PPI for some time yet.
“It’s time for people to decide whether they want to complain to businesses about PPI – and to take action. After the deadline of 29 August, they might still be able to come to us to look into their complaint after a business’s final response – which gives them up to six months to contact us if they’re unhappy.”