It has been reported that just £200 Million was paid out by the Banks in the first 6 months of 2011 in respect of PPI claims made by UK consumers who were mis-sold their Payment Protection Insurance policies. Two hundred million may look like a big number on paper, but when compared to the estimated £10 BILLION the banks have put aside in order to compensate mis-sold customers (fifty times more) then the number pales into insignificance.
There may be a number of reasons for the low payout during the first six months of 2011. One of the major factors was down to the judicial review that was being undertaken at the time. Many Banks had postponed refunding clients whilst the court case took place, and therefore this reduced the level of payouts during that time. Also, the news that PPI had been widely mis-sold by the banks had not hit the headlines at the time and therefore many people were unaware that they could reclaim payment protection insurance (PPI). Or it may just be that many people just have not had the time to make the claim.
A number of things have happened since that should make the next set of released figures for mis-sold PPI payouts significantly higher.
Firstly, the public have been made aware of the scandal, as it has been featured on BBC news and shows such as Panorama. Secondly, the banks did not appeal the court’s decision on PPI and announced that they would be refunding all mis-sold policies without further delay. Thirdly, there has been a massive rise in numbers of claims management companies spring up in the last 6-12 months, who can assist people to obtain a refund on a ‘no win no fee’ basis. Lastly, there is a large number of ‘self-help’ guides on the internet that people can download which instructs them on how to go about claiming themselves.
PPI is an insurance that is attached to loans, credit cards and mortgages that is supposed to cover a person in the event of unemployment, accident or sickness. If a PPI policy holder experiences one of the above that prevents him from working, and therefore being able to afford to pay the loan / card, the PPI policy should kick into place to cover the payments. Unfortunately, due to the profits the banks made from it, many policies were mis-sold by commission-hungry salespeople and many policies didn’t cover people for things they thought they were covered for.
If you feel you may have some PPI claims, then you should make a complaint to your bank ASAP to reclaim PPI because getting back your money should be straightforward as long as you can present a case to the Bank showing that you were mis-sold.