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RBS Loan Insurance

For many years payment protection cover was seen as a valuable product for banks. Sales generated in excess of £5.5 billion a year and the revenue from sales of the cover were often more profitable than the interest from the loans and credit cards to which it was attached. The loan insurance bubble burst in 2006; however, when an investigation by The Financial Services Authority revealed the cover had been widely mis-sold. While some lenders were handed significant fines the lending industry as a whole was warned it needed to improve its standards.

The Financial Service Authority’s investigation highlighted the issue of mis-selling and made it much easier for unhappy customers to make a payment protection claim. Few could have predicted; however, just how widespread the issue of mis-selling would prove to be with in excess of 1.5 million complaints already reviewed.

It is estimated that the Royal Bank of Scotland has sold between 1.6 and 2.4 million payment protection policies in the UK. This figure is obviously significant and includes sales made via Natwest. The sale of RBS loan insurance has undoubtedly made the lender large profits in the past, but recent figures suggest it has already paid out £200 million to compensate customers for mis-selling and has allocated a further £850 million to deal with the issue.

In the second half of 2010 The Financial Ombudsman Service investigated 11,000 PPI complaints. It found in favour of the customer in 70% of these cases meaning the customer would have received compensation. The amount of compensation awarded will depend on the age and size of the loan insurance policy, but under normal circumstances where mis-sale is proven the customer should receive a full refund of premiums paid plus 8% interest.

If you think you may have been mis-sold an RBS loan insurance policy speak to a member of our team on 0207 471 2000.


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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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* Belmont Thornton operates on a "No Win No Fee" basis. This means that there are no upfront costs to pay. Our fee only becomes payable on a successful outcome of a claim. A cancellation fee is payable if you decide that having instructed Belmont Thornton to act on your behalf, and after 14 days of signing your Letter of Authority, you do not wish to continue pursuing your claim with us. The cancellation fee is the reasonable costs incurred for the work undertaken. Please see our terms of engagement.

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