Payment protection insurance policies were mis sold in multiple ways and these tend to be rooted in the actual sales process that was put into place by those who were selling the policies. PPI claims can now be made if you fell victim of this flawed sales process and ended up with a payment protection insurance that you didn’t want or perhaps was not suitable for your needs.
Payment protection insurance was typically a high commission item for the sales teams of the banks which along with the sales targets they needed to meet encouraged them to sell as many PPI policies to customers as possible. This meant policies were sold to people who couldn’t have claimed on them in the future.
Here are some of the most common flaws of the sales process of payment protection insurance which led to so many mis sold policies.
Thousands of customers who were mis sold payment protection insurance policies and now making PPI claims have reported that they were forced into purchasing the policy. Generally this was through the sales team telling the customer that the policy was compulsory and it had to be taken out with the loan when it was in fact optional. This level of force often went one step further with many being told that their loan application success relied on the existence of a payment protection insurance policy and without such a policy they would not receive the loan, credit or store card that they needed.
Not informing the customer they were being sold the policy
Since the discovery of the PPI mis selling scandal there have been thousands of customers finding out they had a PPI policy without even realising they were sold it in the past. This was common due to the way the policies at some banks were sold. Instead of informing the customer that the policy was included with the loan no mention of the actual policy was made and this of course does mean that checks and information regarding the policies was not passed onto the customer. The cost of the payment protection insurance policy each month was put together with the monthly credit repayment and then the loan was said to be “fully protected” without actually telling the customer what this entailed. If you have discovered that you were sold a PPI policy without knowing about it at the time you can now use PPI claims management to make a claim for a refund and compensation for your troubles.
Not explaining the policy terms and conditions
All of the sales team at the banks or finance companies should have ensured that the terms and conditions of the payment protection insurance policies were thoroughly discussed with the customers. They needed to ensure that the customer met the criteria for making a payment protection insurance claim and then all of the potential ways in which they could void their policy to avoid this happening. Points such as employment status and pre existing health conditions should have been checked before the policy was sold and the customer should have been told which health conditions would not be covered by the payment protection insurance policy.
Online Loan Applications
The online sales process regarding loans and the resulting payment protection insurance policies which were attached was inherently flawed, so much so that this type of form and practice has now been banned by the Financial Services Authority and therefore post July 2007 this practice no longer takes place. When applying for a loan online there were various opt out boxes in the form and one of these was for a payment protection insurance policy unless the customer noticed this box and then opted out they would have had a PPI policy attached to their loan. A great deal of customers missed this step and as a result thousands of customers were mis sold PPI in this way. Due to this underhand practice the full terms and conditions of the PPI policy would have not been explained and the customer may have not even been eligible to take out the policy.
There have been some banks or finance companies that have admitted the error in their sales process which they pushed through to their sales team as standard. These particular banks have now started to contact the customers which they have identified as those affected by these flawed sales processes. If you have received a letter it will detail the way in which you need to make a PPI claim, if you have not received a letter or any correspondence from your bank you may still be able to make a payment protection insurance policy reclaim if you feel you were sold a PPI policy through any of the previously discussed methods.