PPI Compensation

There are two and three quarter million people who could be refunded up to 2.7 billion after they were miss-sold Payment Protection Insurance (PPI). Banks and lenders have been given a deadline of the 1st December to adopt the new rules for dealing with PPI complaints, the rules have been put in place by the Financial Services Authority (FSA). An investigation over a five year trading of PPI has found much evidence that sales in PPI have been misleading. Payment Protection Insurance was created to insure peoples loan repayments if they fall ill or become unemployed due to redundancy. New rules which have been introduced are likely to lead to 550,000 complaints being dealt with over the next five years. The average compensation is likely to range from 900 to 1,800, some may have been miss sold regular policies and some people may have purchased premium multi policies. A law firm which represents and advises financial companies has hit out at the new rules stating they no make sense and are not in proportion with the problem present. A spokesperson stated Firms are receiving thousands of bogus complaints and their right to robustly defend those complaints is now being challenged by the FSA. The number of complaints has dramatically increased in number in recent times for PPR compensation, although the FSA has stated that firms have turned down almost half of the complaints. Some firms have rejected almost all claims related to PPI. A new feature of the new rules stated that PPI premiums should be reimbursed along with the interest which would have been earned, if the firm decides that the customer would not have bought the policy in the first place.