Bank notes
The banks have admitted they mis-sold this product widely. The bill could reach £9 billion, which would make it the second biggest mis-selling scandal ever.
Payment Protection Insurance (PPI) failed for a number of reasons. It was often sold to people who could not claim because of circumstances such as age or not being in full-time work.
Sometimes it was sold as if it were compulsory, paid for upfront in a lump sum added to the loan – practices now banned. Many claims failed and the Competition Commission estimated that lenders made £1.4 billion a year in excess profits.
The banks will all consider complaints back to 2005 and most will consider them earlier than that.
If you’ve complained and been turned down, try again – if you get nowhere, go to the Financial Ombudsman.
For details of how to complain, visit which.co.uk/ppi. The average payment is around £2,750. Don’t pay a claims company to help. They do no more than you can do yourself and keep a third or more of your compensation.
Written by Paul Lewis, this article was first published in the July 2011 issue of Saga Magazine. Paul's opinions are his own and for general information only. Always seek independent, professional, financial advice.