Nearly three million people could get PPI compensation

According to the UK’s financial regulator, the Financial Services Authority, nearly three million people could be in line for compensation over mis-sold PPI or Payment Protection Insurance. The regulator claims that 2.75 million people could be entitled to compensation totalling £2.7 billion.

Banks and financial institutions have been given until the beginning of December this year to bring in new rules with regards to dealing with complaints over PPI. The FSA has already said that over a five year period it had found a “wide and deep evidence of weaknesses in PPI sales”.

PPI is a type of insurance cover that is designed to cover repayments on loans and other forms of borrowing for a specified period of time in the event that the policyholder is unable to make repayments due to redundancy, sickness, or injury. However, investigations into the sale of this type of cover found that in many cases the insurance cover was being mis-sold.

One of the ways in which cover has been mis-sold is through selling to those that could not claim, such as the self employed. In other cases consumers were led to believe that they had to take out the cover to get the finance that they needed. In some instances consumers were not even aware that PPI, which is a costly form of cover, had been added to their finance agreement.

In a statement the FSA said: “Today is the culmination of months of hard work and now, with these measures, we look forward to consumers being treated fairly whether they are buying or complaining about PPI. Since we took over the regulation of PPI we’ve carried out 24 investigations and three thematic reviews, issued warnings, halted the selling of single premium PPI with unsecured personal loans, visited over 200 firms, and handed out some very significant fines.”

Tags: payment protection insurance, Financial Regulator, finance, ppi, insurance cover

Thousands get extension to complain about PPI

It has been reported that tens of thousands of consumers who may be looking to make a complaint about PPI, or Payment Protection Insurance, have been given an extension to the deadline to make their complaint by the UK’s financial regulator, the Financial Services Authority.

The normal deadline for PPI complaints in relation to being mis-sold the cover is six months. However, the FSA has extended the deadline for five months for those whose complaints were rejected by firms between November 28^th last year April 28^th this year. It is thought that around fifty five thousand people could benefit from the extension.

The additional five month period that has been granted by the FSA means that the tens of thousands of people whose complaints were turned down between November last year and April this year now have until towards the end of October this year to complain.

There was a delay in the FSA’s own plans whilst it decided how companies should be made to deal with PPI complaints. However, the regulator did not want consumers to suffer as a result of the delays, and this is why it has decided that it should extend the complaint deadline.

PPI has been at the centre of controversy for some time, and there have been investigations carried out showing that many people were mis-sold these policies, which were often sold to those that did not want them or were under the impression that they had to have the insurance cover in order to get the finance that they wanted.

One consumer said: “I’m glad that the FSA decided to extend the deadline, as otherwise I would have missed out on my chance to complain and possibly get a refund on cover that I believe to have been mis-sold to me.”

Tags: investigations, mortgage, delay, finance, year, ppi, payment protection insurance

PPI ban could mean higher fees and charges

It was announced recently that regulators are planning to stop the sale of the controversial single premium Payment Protection Insurance policies from lenders in 2010, and in fact in a bid to stop the sale of these policies regulators actually contacted lenders last month asking them to stop selling single premium PPI by the end of last month. Read more

Tags: ppi, single ppi policy, credit card insurance, payment protection insurance, loan insurance

Ban on PPI by Competition Commission

For the past few years the insurance cover known as Payment Protection Insurance or PPI has been causing a great deal of controversy in the financial world. Read more

Tags: Competition Commission, selling, meet repayments, mortgage, payment protection insurance, current economic downturn, taken out

Victory over bank sales of PPI

Over recent years there has been a lot of controversy over single premium payment protection insurance cover. Whilst much of the concern has been related to the way that this type of insurance cover has been mis-sold by many lenders and providers, there has also been a lot of concern relating to the cost of single premium PPI. Read more

Tags: PPI victory, useful type, Types of insurance, ppi, payment protection insurance, PPI product

Progress with PPI not fast enough

Senior officials from the UK’s financial regulator, the Financial Services Authority, have said that progress is not being made quickly enough in the crackdown on the mis-selling of PPI. Payment Protection Insurance has been at the centre of investigations and controversy for some time after investigations revealed that it was commonly mis-sold by lenders and providers. Read more

Tags: relation, payment protection insurance, lenders, mystery, consumers, controversy

£22 million in fines from FSA over 2008

Recently released figures have indicated that over the course of 2008 the Financial Services Authority handed down around £22 million in fines as it continued its crackdown against the mis-selling of payment protection insurance cover and tried to curb rising levels of mortgage related fraud. The UK’s financial regulator has been handing down record fines over the course of the year according to industry officials. Read more

Tags: ongoing problem, disappointment, financial, Financial services, fsa, mortgage, time, payment protection insurance

Increase in PPI complaints results in further investigation

According to a recent report a huge rise in the level of complaints being received in relation to PPI, or payment protection insurance, has resulted in calls for further investigation into the sale of this type of insurance cover. This cover is commonly sold alongside credit such as loans and credit cards, and the purpose of the cover is to meet repayments on the debt for a set period of time if the policyholder cannot work due to sickness, injury, or redundancy. Read more

Tags: industry group, fsa, redundancy, financial industry, payment protection insurance, investigation, financial ombudsman, work

Competition Commission plans to look into PPI

PPI, which stands for Payment Protection Insurance, is a type of cover that is often sold with loans, credit cards, and other forms of credit. The purpose of the cover is to make repayments on the debt for a certain period of time if the policyholder cannot work and earn money due to illness, accident, or redundancy. The cover is often costly, but can prove valuable to those that can use it, as it offers peace of mind. However, it has been found that the cover has often been sold to those that can never claim on it, such as retired people and those that are self employed. Read more

Tags: payment protection insurance, use, payment, cap, U.S. Producer Price Index

Credit card protection ‘important’

Consumers who use credit cards on a regular basis should look to take out payment protection insurance (PPI), it has been advised.

Shane Craig, managing director of Paymentcare.co.uk, has suggested that PPI can be as important for credit cards as it is for personal loans.

He acknowledged that currently more people were taking out PPI for loans because the amounts were often higher than the average credit card balance.

However Mr Craig advised: “For people who tend to max up their credit cards, protection is just as important.”

“With credit cards being the most expensive way of borrowing money, the cumulative effects of not being able to make your repayments are punitive,” he added.

Mr Craig went on to confirm that payment protection on any borrowing was something to consider because events such as job loss and illness can come completely out of the blue.

In December 2005, 47 per cent of consumers had unsecured borrowing of £10,000 or more. The average household owes £7,650 and the overall British consumer debt is £1.3 trillion not counting mortgages.

Tags: borrowing, repayments, credit, borrowing money, payment protection insurance, cumulative effects, Insurance

Knowing Your Loan Penalties

Knowledge is power…

It’s quite easy to find a loan these days. Whatever you want it for, you will undoubtedly find a company willing to lend you the money, even if you have CCJ’s or bad a credit rating. When you’re shopping for a loan you will of course be looking at the interest rates and comparing them to get the cheapest rather than settling for the first one you see. Read more

Tags: credit card company, loan penalties, bad idea, payment protection insurance, loan charges, loan fees. mortgage penalty, debt

NI bankers may get interest-free overdrafts

People who do their banking in Northern Ireland (NI) may soon benefit from interest-free overdrafts.

That is after a report released by the Competition Commission which has been looking at ways of increasing competition and lowering charges in the NI personal current account market.

A list of “proposed final remedies” has been published by the commission and one of them is to force banks to give customers interest-free overdrafts.

Some banks in the province have admitted that the charges they impose on some customers are not directly derived from costs and it has also been found that many are being subjected to charges which are not present elsewhere in the UK.

All of this was discovered by the Office of Fair Trading two years ago and now the commission has come up with its remedies.

Among the ideas are calls for the provision of easy-to-understand descriptions of account services, clear explanations about charges and increased amounts of information on statements.

The Competition Commission would also like to see customers being provided with an annual breakdown of charges and interest charged, an annual reminder that they have the right to close or switch their current account and improvements to the switching process.

Tags: reminder, provision, government, trading, Competition Commission, office, competition, payment protection insurance

GECB fined over PPI

GE Capital Bank (GECB) has been fined by the Financial Services Authority (FSA) for failing to have adequate systems and controls in place for selling insurance.

The bank was hit with a £610,000 fine following an investigation into payment protection insurance (PPI) by the FSA.

GECB works in providing credit finance through store cards, credit cards and sales finance. The firm has been found guilty of treating customers unfairly.

“Millions of people take out store cards every year,” said Margaret Cole, director of enforcement at the FSA.

“They need to know that PPI is almost always optional and should consider whether they need it before signing up.”

GECB has been punished for failing to provide adequate information to consumers regarding PPI and failing to retrain staff after it was highlighted that they were not complying with sales procedures.

The FSA has warned that GECB will not be the last firm to come under scrutiny regarding PPI.

“Our focus on Payment Protection Insurance will remain very high this year,” warned Ms Cole.

“We are determined to see significantly better practice in PPI sales and will crack down where firms fail to treat their customers fairly.”

GECB has committed to taking action to redress the highlighted issues, which resulted in the fine being reduced from £870,000.

Tags: payment protection insurance, fsa, finance, adequate information, consumers regarding ppi

Credit Card Insurance

Fear factor

These days we are inundated with stories about identity theft, muggings, credit card theft and the general dangers of losing our treasured credit cards.

The dangers of modern living with its job insecurity, illness, theft and all those other things we dread are quite enough to make anybody want to turn to insurance for their own peace of mind. But are Credit Card Protection Plans the answer?

A Sign of the Times

When you start to use a credit card you will get an offer from the lending company to provide you with Credit Card Insurance. Primarily this is to safeguard the money that the institution has lent you. If you lose your job and go belly up with thousands owing on your card and no way to pay it back, they will want a way to ensure their money is safe. It’s also a way for them to make some extra money off you!

There are two main dangers for credit card users:

• loss or theft of the cards themselves
• loss of income

Live dangerously

There are those that regard the risks associated with the debts on a credit card as being tolerable. If you are one of those people who always knows where their credit cards are and has never lost anything ever, then you may feel the same way. You may also count yourself lucky!

Too much

Sometimes people feel insurance is an unnecessary cost because the package being promoted by the credit card company isn’t offering what the cardholder actually wants. It may not be the best value for money or it may be that it provides too much cover. If this is the case there are a number of off-the-shelf alternatives.

Safeguard against risks

Usually a Card Protection Plan (CPP) will provide some insurance against fraudulent use of your card or use of your card without authorisation. They will also include a facility for an emergency cash advance for ticket replacement and hotel bills (in case you suffer lose or theft while staying away) and may provide some cover for any cash that was stolen at the same time as your card.

But there are alternatives to CPPs.

And the family came too

Sentinel Card Protection is one of the most well known insurers specialising in credit cards. For a one-off annual fee they will protect all your credit cards with the same cover. That includes notifying all card companies involved in a theft of your cards and arranging for replacements to be issued. They provide up to £75,000 worth of cover against fraudulent use if they are notified within 24 hours of the loss or theft. They also provide an interest free loan for up to £3,000 to get you out of trouble if you are stranded abroad.

The key thing about Sentinel is that it will cover all your cards and all those of other members of the household with the same one off payment. It offers a three year one off payment option which is even better value at just £50.00.

Their service includes handy items such as a luggage tag retrieval service, so no matter where your luggage may end up Sentinel will help you get it back with their security coded unique reference number system.

They do not however, cover redundancy or your inability to make payments due to long term illness. For this type of cover you would need Payment Protection Insurance or PPI.

Holistic care for your Credit cards

This approach is to insure your payments so that you can continue paying if you get sick or suffer an accident which leaves you unable to work. A plan such as Paymentcare would be issued by a Financial Services Company and could be arranged either directly with the insurer through the internet, or through your broker or Financial Advisor.

This type of insurance will specify how high the maximum balance can be to be eligible for cover, and how long the policy will pay the credit card payments or whether it pays off the full sum in one go.

All these details would be raised as you discuss the plan with your broker or fill in the application form. In this way you can be sure to get an insurance policy that exactly suits what you are looking for. The premiums are usually payable as monthly direct debits and the amount would reflect the type of cover you chose.

Better to be safe than sorry

Whether you decide to insure yourself against the risk of being unable to repay the outstanding balance on your credit cards will really come down to your general outlook on life and your whole attitude to risk… and whether you think the world is really as unsafe as we are all led to believe.

Tags: payment protection insurance, unnecessary cost, better value, credit card theft, theft, Credit card users, ticket replacement

Payment Protection Insurance – Worth The Extra Cost?

Protecting yourself against going into debt is a logical step for many people; but you have to make sure the insurance is actually worth the risk. Read more

Tags: likelihood, taking, loan insurance, time, professional advice, payment protection insurance, mortgage insurance, ppi

Debt Consolidation Loans – What Are They?

Debt is an interesting thing, it quite often creeps up on you before you realise what’s happening and then it drags you under, gripping hold of you like a drowning person and under you go before you’ve had a chance to catch your breathe. Read more

Tags: consolidate debts, Credit card, debt consolidation, payment protection insurance, advertising, ccj, income, debt consolidation loans