Payment Protection Insurance (PPI) will cover the payments on a loan if the borrower is unable to work for a period of time. This sounds reasonable and prudent. The reality is that mis-sold PPI adds an unnecessary cost to the loan and does not benefit the buyer.

85% of these Payment Protection Insurance claims never pay out. The consumer must submit PPI claims within a certain time frame after the triggering event and then wait 3-6 months for the policy to become active. All the while the consumer must continue to make full and timely payments on the loan. Even if he or she finally qualifies for payments, the loan may have already defaulted.

Despite the fact that PPI claims seldom pay out, the large banks have continued to sell payment protection cover –UNTIL SELLING PPI AT THE POINT OF SALE WAS BANNED. Either when the loan is purchased or sometime thereafter, the buyer is convinced to take out the insurance. Some mis-sold PPI was not even disclosed to the buyer, but incorporated into the loan without being mentioned. At other times, the borrower was told the loan would not be approved without PPI insurance.

Some Payment Protection Insurance claims go unpaid due to exclusions that are hidden in the language of the policy. Sometimes the borrower was ineligible for pay-outs because he had reached retirement age, was unemployed or worked part time, was a full-time student, or had a pre-existing medical condition.

Sally Bowyer, Managing Director of Brunel Franklin said: “Everyone accepts that banks provide a valuable service and are entitled to make fair and reasonable charges for services. But people shouldn’t be sold PPI without being furnished with the full facts. PPI mis-selling cases serve as timely reminder of how careful we all need to be when taking out new loans and other credit card agreements.”

Learn more about PPI refunds and find out if you could apply for a refund today! Visit the website www.brunelfranklin.com or call Brunel Franklin, free, on 0800 051 54 51.