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Barclays payment protection

Did you know if you have taken out a Barclays Payment Protection insurance policy in the last 10 years your policy may have been mis-sold and you may be entitled to make a claim potentially worth thousands of pounds? The bank is estimated to have sold between 1.6 million and 2.4 million policies and, although it is not known just how many of these were mis-sold, Barclays Payment Protection has become one of the most complained about PPIs.

In April 2011 Barclays announced it had allocated £1 billion to deal with payment protection mis-selling claims made by its customers. The huge sum is thought to take into account both staffing costs and the cost of any compensation paid out to the victims of mis-selling. The pledge is in addition to the estimated £200 million already paid out to settle PPI claims. It is not only Barclays Payment Protection Insurance that is controversial; however, the PPI scandal has affected many different kinds of lenders across the financial world.

Payment Protection insurance is, in essence, an insurance product designed to protect a borrower from financial hardship. The cover is supposed to step in if the borrower cannot work due to sickness, accident or redundancy and cover repayments. Barclays payment protection may be one of the most well-known, but the cover is also sold by most other banks and building societies including: Lloyds, HSBC and RBS.

PPI has been sold for up to thirty years and quickly came to be viewed as a significant additional revenue stream for many lenders. With high costs and low rates of payouts lenders often found, in fact, that PPI could be more profitable the interest from the financial products to which it was attached. Soon PPI began to be attached to a variety of different products including loans, mortgages, hire purchase agreements, store cards and credit cards. In addition, PPI was no longer just sold in a bank branch, but banks began telephoning customers to try and sell them the product – sometimes persistently calling customers to try and close the sale. PPI also became widely sold in by shop assistants, along with store cards, and in car dealerships with hire purchase agreements.

As the number of PPI products on the market grew and became more widely sold there was an upsurge in the amount of complaints regarding the cover. A lack of staff training or understanding regarding the product meant many customers were being sold the policy without being given sufficient information. In other cases people who were not eligible for cover, for example because of age or circumstances, were sold the insurance. The profitability of the cover also meant many lenders offered significant rates of commission for the sale of the cover. This led some staff to use high-pressure sales techniques and, in some cases, policies were even added without the customer’s knowledge.

If you think you may have been mis-sold Barclays Payment Protection insurance or any other kind of loan insurance and are interested in reclaiming PPI call our claims team on 0207 471 2000.

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