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Cheapest PPI

One of the main problems with payment protection insurance throughout the past several years is that lenders weren't allowing consumers to choose which insurance company they would like to purchase cover from, if any. There was no way a borrower could shop around for the cheapest PPI because lenders more or less dictated which insurance was made available to borrowers. In fact, most choices were taken out of the borrower's hands as lenders were making a nice fat profit by selling a specific PPI cover. This had been the cause for so many PPI claims, but the government recently made some very important changes to the rules governing the sale of payment protection insurance and that is about to stop.

Lenders Denying Borrowers Cheapest PPI

Many of the complaints that were registered with the Citizens Advice Bureau and the Financial Ombudsman Service were about lenders who were forcing specific loan protection insurance on borrowers in a few ways. Sometimes they were simply adding it to the closing statement without informing the borrower whilst other times they were 'strongly suggesting' that the loan would be easier to qualify for if this payment protection were purchased. In any event, because the borrower didn't have the opportunity to choose a different insurance company, there was no way to determine what the cheapest PPI was and even whether or not they wanted to buy any insurance at all!

New Legislation Puts an End to Forced PPI

Recent legislation has taken this power away from lenders because the new rules regulating the sale of payment protection insurance now state that anyone who takes out a loan must wait 14 days before they can purchase loan insurance. Lenders will no longer be able to force consumers to purchase the cover they want to sell and this gives the borrower time to compare quotes to find the cheapest PPI cover. However, there are other things to consider when looking at payment protection insurance besides cost and that would be whether or not you would be eligible to draw cover from a policy.

Is PPI At Any Cost Worth the Price?

Another reason why so many people have filed a PPI claim for a refund is that PPI cover is often overrated. There are so many conditions and exclusions in the 'small print' that the average person just isn't eligible for cover! Even the cheapest PPI may not be worth the price if there is no cover to be had. For example, self employed, temporarily employed or unemployed persons don't qualify for benefits nor does anyone over the age of 65. If you have pre-existing medical conditions that would render you unable to work for a time, you would not be covered nor would you be covered if you injured your back. Back injuries are never covered. Even the cheapest PPI would be an unnecessary expense in most situations so be sure to totally understand the policy before purchasing payment protection insurance.


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