The last minute rush to make a claim for potentially mis-sold PPI before the claims deadline has ‘gone nuclear’ according to one bank official.
Consumers only have until midnight on August 29th to make a PPI claim or lose the right forever and the countdown has led to a surge of complaints.
Financial Times journalist Nicholas Megaw said that an executive from one high street bank told him: “As we get towards the end there has been an absolute surge in information requests. It’s gone nuclear in the second quarter of the year.”
More than a decade after the mis-selling scandal first came to light, tens of thousands of people are now rushing to make sure they don’t miss out on the possibility that they might be owed thousands of pounds because they were mis-sold the insurance.
An estimated 64 million policies were sold over three decades as a way of ensuring that payments could be made on a financial agreement if the consumer had to come out of work through accident, sickness or unemployment.
Many sales were perfectly legitimate and the insurance did what it was supposed to do. But millions of policies were mis-sold to people who didn’t want them, didn’t need them and could never have benefitted from them if they needed to claim.
More than £35 billion
Britain’s lenders have already paid out more than £35 billion in compensation with payouts still averaging more than £⅓ billion a month.
Now with just weeks to go before the deadline passes thousands of information requests are flooding in to lenders with consumers wanting to know if PPI was ever attached to any of their financial agreements.
The Financial Conduct Authority (FCA) has issued a warning that information requests can take up to eight weeks to process which could mean the consumer not getting an answer before the cut off date.
But several banks have agreed with the FCA that if PPI is found to be present they will convert an information request into a full claim automatically to make sure the deadline is beaten.
The previous process involved making a separate claim once the presence of PPI was confirmed, but under the new system officials will fully investigate any potential claim without any need for further involvement from the customer.
Lloyds Banking Group (LBG) – which includes Lloyds, Bank Of Scotland, Halifax and MBNA – Barclays, HSBC, Royal Bank Of Scotland (RBS), NatWest and the Nationwide Building Society have all confirmed they are taking part in the scheme.
Were you mis-sold?
If you took out a loan, credit card, mortgage, store card or catalogue account, you could have been mis-sold PPI if you experienced any of the following:
- You were pressured into buying PPI or told you must have PPI
- You were promised a cheaper rate if you bought PPI
- You were already covered by another policy
- You received full sick pay from your employer
- You were told your loan or credit application was more likely to be accepted if you bought PPI
- You were advised to buy PPI that did not suit your circumstances or needs
- You were self-employed, unemployed or retired but advised to buy PPI
- You had a pre-existing medical condition at the time of buying PPI, which may have affected your ability to make an insurance claim
- You were advised that a pre-existing medical condition was included in your PPI policy (or advised that it wasn’t included)
- It was not made clear that you would pay interest on the PPI if it was added to your loan
- It was not made clear that the PPI would end before the loan or credit was repaid
- The amount of commission paid on the sale was not revealed at the time
There is one other way PPI was ‘mis-sold’ – unscrupulous sales people added it to your agreement without telling you – and if that happened you definitely wouldn’t know now either so it’s worth checking things out.