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What Is Personal Protection Insurance

Since 2006 an increasing number of PPI claims have been filed against lenders that either failed to inform customers of the policy terms and conditions, or did not mansion the policy at all. You may be wondering "What is personal protection insurance?" Personal protection insurance, also referred to as payment protection insurance, is supposed to help borrowers cover repayments in the event that they are unable to do so for various reasons. With tens of thousands of UK citizens claiming back payment protection on loans each year the PPI claims process is becoming easier to facilitate for an experienced firm like Belmont Thornton, as most cases are ruled in favour of the borrower.

What Is Personal Protection Insurance Reclaiming?

Before a PPI reclaim can be honored, several factors related to how the policy was sold need to be considered, including the applicant's eligibility, and whether they were adequately informed of policy terms, conditions, and costs. About 30% of the claims brought before the Financial Ombudsman Service (FOS) are related to borrowers claiming back payment protection on loans or credit cards. Approximately 60% of the cases reviewed pertained to various types of loans, while the remaining 40% pertained to mortgages and credit cards. As long as it can be proven that the PPI policy was mis-sold, either by deceit or persuasion, you should be successful in claiming back payment protection on loans.

Why Do Personal Protection Insurance Companies Deny so Many Policy Claims?

Personal protection insurance companies deny a large number of claims because many of policyholders are actually ineligible for coverage. While the situations that are eligible for coverage vary depending on the policy terms and conditions, most PPI policyholders will be denied benefits. The Financial Services Authority (FSA) has criticised both lenders and insurance companies for not only failing to sell PPI policies properly, but also offering an insurance product that does not provide a fair value. Although PPI policies can cost as much as 13 to 56% of the overall loan amount, less than 15% of policyholders receive repayment assistance. Most people that consider claiming back payment protection on loans do so because they feel they were not specifically told how the insurance policy works, what type of coverage it provides, how much it costs, and how policy payments will be structured. What is personal protection insurance? It is a type of insurance cover that is quite often mis sold to those who cannot benefit from it!

Reviewing the Massive Influx of PPI Mis-Selling

The rampant mis-selling of PPI policies in the United Kingdom is caused by a combination of misinformation and negligence on behalf of lenders and insurance companies. When a PPI policy is purchased a lender receives a commission, and if the policy is paid for with a one-time premium then the total amount of the loan increases (resulting in more interest earned for the lender). During 2009 there at least 30,000 PPI claims filed, a statistic that climbed significantly in 2010 to nearly 50,000 claims. The Financial Ombudsman Service estimates that an approximate 60,000 to 70,000 UK residents will be successful in claiming back payment protection on loans with the assistance of a professional PPI claim company like Belmont Thornton. Luckily, now that many financial authorities in the UK have begun recognizing PPI mis-selling as a widespread problem, claiming back payment protection on loans has become much easier. Hopefully, the information above has sufficiently answered your question "What is personal protection insurance?"

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