Stop. Do not claim PPI. Or do, but do it yourself.
The PPI claim bandwagon is still rolling, and like ambulance chasers before them, the number of PPI claim management companies (CMCs) is also multiplying like horny rabbits. However, there is still over £5bn in mis-sold PPI yet to be claimed, meaning it is still worth their while trying to snare unsuspecting consumers.
So, your alternative (but not-as-interesting) consumer champions MoneySavingExpert.com and Which! have joined forces to increase awareness of how easy it is for consumers to reclaim mis-sold PPI without paying anything and to tackle the unscrupulous CMCs who exploit consumers wanting to claim back their money.
Which! and MSE are calling a ‘PPI Summit’ next Monday to try and “get all parties working together to help people get back the money they are owed and help restore trust in the PPI claims process.” They are also launching a radio advertising campaign to increase awareness. You can listen to it here if you are so inclined.
However, the best thing about this collaboration is the shouting about their free PPI claiming tools (at which.co.uk/ppi or moneysavingexpert.com/ppi ) which enable you to enter your email address, policy details and mis-selling reason (see below) and they will email your claim off to the relevant department of your PPI provider. Simples. With an average payout of £2,750, and CMCs taking a standard fee of 25% plus VAT, consumers could pay £825 for almost literally nothing at all. Which is never a good idea.
Which!’s mis-selling checklist helps you determineif you have a PPI claim, and therefore what your mis-sold reason would be:
If you can answer 'no' to one or more of these questions, then you may have been mis-sold PPI.
If the insurance was optional, was that made clear to you?
Did the adviser tell you about any significant exclusions under the policy – for example, the exclusion that says you won't be covered for any pre-existing medical condition?
If you took out a loan or finance agreement, did the adviser make it clear that you would have to pay for the insurance up front in one single payment?
If you had to pay for the PPI as a single payment, did the adviser make it clear that the insurance cost would be added to the loan and you would be paying interest on it?
Single premium PPI insurance normally only lasts for five years. If your loan or finance agreement was for longer than this, did the adviser make it clear that the insurance would run out before you had finished paying for your loan or finance agreement? The adviser should also have told you that you would continue to pay interest on the insurance premium, even after the insurance expired.
If you bought PPI after 14 January 2005 did the adviser try to persuade you to take it out by saying something like 'we strongly recommend that you consider taking out PPI'. If so, the sale counts as an 'advised' sale and they should have issued a 'demands and needs statement' to show why a particular policy has been recommended and why it is suitable for you. If they didn't, this is grounds for complaint.
MoneySavingExpert.com’s Martin Lewis said:
"We’re at crisis point now. There’s over £5 billion of PPI to be given out but, scarily, almost £2bn of that could end up in claims firms’ coffers, rather than people’s pockets and often all these firms do is send out similar template letters to the ones we give people for free.”
Which! executive director Richard Lloyd said:
"It's a scandal that too many CMCs have been ripping off consumers who don’t realise there are simple steps they can take to claim back their money themselves. We're saying to people today - don’t get robbed twice."
Bitterwallet executive editor-in-command Andy Dawson said: