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PPI Rules

Even as little children we learned that if we lived by the rules life would be a whole lot easier for us. It's amazing that so many lenders in the UK have forgotten what it is like to obey the rules and as a result have gotten themselves into some deep trouble! Although there have always been PPI rules regarding the sale of payment protection insurance, many lenders chose to ignore those rules and now that they are called to task for breaking them. At any rate, there always were PPI rules, there are PPI rules and there will continue to be rules regarding the sale as well as the PPI claims procedures involved in payment protection insurance.

What Are the Rules in Selling PPI?

Without getting into legal definitions, the rules for selling PPI are really quite basic. Don't sell it to anyone who can't use it. Don't sell PPI to anyone who doesn't know they are buying it. Don't force someone to buy payment protection insurance and never, ever lie about what the cover can and can't do. That is pretty basic and those PPI rules are quit easy to obey, so, in the past, why didn't some salespeople? It is difficult to pinpoint the cause of the PPI scandal, but it is likely to be a number of things combined. A lack of training, in many cases, was a factor and many lenders were also criticised for failing to put in place appropriate proceedures to protect customers from the threat of being mis-sold an unsuitable policy. Many critics have also pointed to the high profits often gained from selling the cover and how high rates of commission led some sales people to bend the PPI rules regarding sales.

Claims Procedure

Just as there are rules in the selling of PPI, there are rules to be followed in the PPI reclaim procedure. If a consumer files a claim with the lender alleging the mis sale of PPI, the lender is required to review the claim and give it due consideration based on the merits of that particular claim. PPI rules dictate that claims denied by lenders can be brought before the Financial Ombudsman Service for an appeal. Each step along the way is subject to rules and regulations which are overseen by the Financial Services Authority. This is the government agency along with the FOS that make sure every step along the way is fair and equitable.

If you feel that your lender broke the PPI rules and mis sold you payment protection insurance, it is your right under those same rules to file a complaint against that lender. You are entitled to a PPI refund if it is decided that you were, indeed, mis sold this cover.


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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.

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