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PPI Private Insurance Pay Outs

One of the things which may be news to many consumers in the UK is the fact that not all loans are underwritten by large financial institutions but have been financed on the secondary market. PPI private industry loans are also subject to mis selling of PPI and the actual lender may even finance the insurance as well! Such entities may be the actual businesses that mis sell PPI as well as being the insurance underwriter. Of course there will be times when a private lender wants the added revenue and the added assurance that payments will be made so that lender will need to be the one responsible for PPI private insurance and PPI private insurance pay outs as well. In fact, in either case that lender would indeed be liable to make PPI private insurance payouts that result from a payment protection claim.

Who Is Ultimately Responsible?

After taking out a privately financed loan and finding out you were mis sold PPI cover, you are probably questioning who is ultimately responsible. It appears as if the courts are fining brokers but holding the lender accountable for PPI private insurance pay outs. The logic behind this is because the lender is the one who is lending the money, signing off on the loan and it is his/her responsibility to fully read the loan docs to make sure all is in order. By signing off on the loan that lender is saying that all is in order and ready to be financed. The lender should be able to spot the discrepancy in figures by seeing payment protection insurance on the closing sheet which means it is time to question if all UK guidelines were followed when selling PPI. Failure to do so is no excuse and the lender is still ultimately responsible for making those PPI private insurance pay outs.

How This Will Impact the Insurance Industry

Most often private insurance is owned by the very same lenders that are underwriting loans when it comes to the larger conglomerates. It does take a certain amount of capital to finance underwriting insurance so having to pay millions of pounds in PPI private insurance pay outs can quite literally break a financial institution. If the insurance underwriter is a subsidiary of that lender, sometimes even secondary lenders, then there is a very good chance that PPI private insurance pay outs will have a significant impact on the insurance industry. Remember, the larger insurance companies can absorb the loss a whole lot easier than the smaller private companies. In either case, the court has ruled that PPI claims be honoured and money must be made available for those pay outs.

If you need help filing a claim against a private lender, Belmont Thornton can provide initial consultation as well as filing the claim and staying with it along the way. Whether you are looking for a PPI private insurance payout or a refund from a major lender, the claims team can help.

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