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Tackling your debts

PPI mis-selling - what is Payment Protection Insurance anyway?

Posted 21 March 2013

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Have you been mis-sold PPI? What does 'mis-selling' mean anyway? How could you reclaim any refund you're entitled to?

Payment Protection Insurance (PPI) mis-selling is a big story these days. You've probably seen (or heard) the adverts. You might have had quite a few phone calls about it.

But in case you don't know what it's all about, here's a brief summary:

  • PPI is a form of insurance people can take out when they borrow money.
  • If they can't afford their repayments, their PPI policy could pay them on their behalf - but that would only happen if they met all the conditions.
  • Plenty of people who've bought a PPI policy wouldn't qualify for a payout (because they're self-employed, for example, or retired).
  • And lots of others:
    • didn't ask for PPI, or
    • didn't have it explained properly, or
    • were told they had to take it out, or
    • have a medical condition that would mean they weren't covered anyway.
  • That means millions of people might have been mis-sold PPI - and could be entitled to a pretty hefty refund.
And there are plenty of other reasons a PPI policy could be judged 'mis-sold'.

What could I reclaim?


If you were mis-sold Payment Protection Insurance, you might find you can reclaim hundreds - or even thousands - of pounds. If you're worried about your debts, that could make a serious difference to your finances.

How do I do it?


Check your contract (you can ask your lender for a copy). Call your lender and they'll tell you what to do to make a claim.
If it doesn't work out, you can contact the Financial Ombudsman Service (be aware that it can take up to 18 months to get a decision from them). It's well worth clicking on this link before you contact your lender in the first place, as the website has some useful information about PPI mis-selling and refunds.

There are also companies that would help you with your PPI claim - just make sure you find out at the start how much they'd charge for their services.

by Christine Walsh

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To find out more about managing your money and getting free debt advice, visit Money Advice Service, an independent service set up to help people manage their money.