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Barclays Loan Insurance

If you have a personal loan or a mortgage then it is very likely when you arranged the loan you were also offered some kind of loan insurance or Payment Protection insurance cover. The cover is sold as a financial safety net which will step in and take over your repayments if you cannot work due to accident, illness or redundancy. The cover is not suitable for everyone; however, and has been frequently mis-sold.

Barclays loan insurance is big business for the lender and can often prove to be more profitable than the loans to which it is attached. The reasons for this are two-fold. Firstly, the cover can be very expensive. On a typical loan, insurance can cost somewhere between 13%-25% of the base loan value. In addition, the rate of pay outs against such policies are often very low. An investigation by The Competition Commission in 2008 revealed that Barclays loan insurance and other similar types of loan PPI have an average pay out of just 15%. This means that for every £1 spent on PPI the lender pay make as much as £0.85 profit. The low pay out rate is further highlighted when it is compared to car insurance pay outs which, in the same survey, were revealed to be 79%.

Because of the way in which PPI is tied up in loan repayments many people do not appreciate just how expensive their policy may be. If you have Barclays Loan Insurance it is worth taking a look at your original loan agreement to find out just how much your insurance costs. It is also worth taking a look at your policy terms and conditions to find out whether there is anything about your circumstances that may make you ineligible to use the policy. A major problem with Barclay Loan Insurance and other similar forms of Loan PPI is that most have a high number of exemptions. Exemptions are clauses within the policy that list circumstances that will not be covered. With PPI policies this will usually include people over the age of 65 and pre-existing medical conditions.

Many people take out Barclays Loan Insurance and other similar policies believing they will be covered in every eventuality and that their lender would not have recommended it if it were not suitable for their needs. Unfortunately, because of a lack of staff training, internal processes and, in some cases, human error many people have been sold PPI cover that they will never be able to use.

If you are believe you may have been sold a Barclays loan insurance policy that was unsuitable for your needs or your policy was sold without the full terms and conditions or costs being explained to you, you may be able to make a claim. Since 2006, 1.5 million people have registered complaints regarding the mis-selling of PPI and it is estimated that a further 2 million policies may have been mis-sold. For more information call 0207 471 2000.

We also help customers who have been charged unfair over the limit or late payment fees on their credit card. If you are interested in claiming back bank charges contact us today.


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Belmont Thornton Limited is regulated by the Claims Management Regulator in respect of regulated claims management activities; our registration is recorded on the website www.gov.uk/moj/cmr number 18273

Belmont Thornton Limited is incorporated in England and Wales, Company number 6621233, whose head office at Unit B16, Kestrel Court, Harbour Road, Portishead, Bristol, BS20 7AN and registered office at Harwood House, 43 Harwood Road, London, SW6 4QP.

Belmont Thornton Limited is registered with the Information Commissioners Office. Registration number Z1728023.

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