What is PPI?
Payment Protection Insurance (PPI), also known as Loan Protection Insurance was added to loans, credit cards, mortgages, car finance and store cards to protect you if you were made redundant or had an accident or illness that meant you were unable to work.
How was PPI mis-sold?
PPI was mis-sold for a variety of reasons:
- Your eligibility to claim was not assessed – if you had a pre-diagnosed medical condition or were self-employed, retired or a student, in many cases you would not be able to make a claim.
- Lenders put pressure on you to take out the policy – often by insinuating that you would be more likely to get approved for the finance if you took the policy.
- Sales targets meant some sales people added PPI to finance without you even knowing.
- You were not told about the alternative options to PPI – either different products or providers.
- The terms and conditions of the PPI were not explained to you.
- You had to pay for the policy up front (this is called a single premium policy).