What is PPI and did I have it?
LAW firm Harcus Parker is revisiting the UK’s costliest consumer scandal with the belief that lenders owe a further £18 billion in compensation for a new PPI claim.
The first court hearing for its claim will take place in October and, if successful, Harcus Parker expects the average claimant to receive between £2,500 and £3,000 in compensation. In some extreme cases, customers might receive up to £10,000.
Find out if you’re eligible for compensation
You can find out if you’re eligible for compensation by filling out this form on Harcus Parker’s website.
While the deadline for mis-sold PPI claims closed in 2019, this new case is different.
This deadline was for mis-sold PPI, not for the commission which was sold on these policies. Here’s how it works…
What is PPI?
PPI – an abbreviation of Payment Protection Insurance – was a form of cover sold alongside credit cards, mortgages, loans and other lending.
It promised to cover the cost of your borrowing if you lost access to your regular income – for example, if you fell ill or were made redundant.
Depending on the policy, it could cover the entire cost of the credit or just a set number of repayments.
Like other forms of insurance, these policies were bought by paying a premium.
Lenders would either add the cost of the premiums to your credit or make it payable through a separate fee.
PPI was first sold in the 1970s, according to the Financial Conduct Authority (FCA), the industry watchdog.
But it was in the 1990s and 2000s when the largest number of policies were sold.
In 2009, the sale of single-premium PPI policies was banned.
How was PPI mis-sold?
Check your eligibility for PPI compensation for free
When it was legal to sell PPI, most of these policies were mis-sold.
Lenders would often add the price of this cover to their customers’ credit without informing them.
In some cases, lenders lied and told customers PPI was compulsory.
In other examples, some people were sold a policy they were never eligible to claim under.
Around 65 million PPI policies were sold in the UK, and this resulted in banks paying out around £38 billion in compensation to their customers.
This makes it the UK’s costliest consumer scandal – and Harcus Parker believes there are a further six million customers who remain uncompensated.
Can I still make a claim?
The PPI scandal kicked off after the the sale of single-premium PPI policies was banned in 2009.
To bring the scandal to a close, the FCA set a deadline of 29 August 2019 for consumers to lodge their PPI compensation claims.
Now that the FCA’s scheme has closed, it is necessary for customers to bring their claims through the courts.
Why is the PPI scandal being looked at again?
PPI was a profitable product for most banks and lenders.
So, they often incentivised their employees to sell these policies by offering decent commissions, with Harcus Parker stating that some lenders were earning around 75% of the price of the policy.
In other words, for every pound you paid for PPI, your lender was taking 75p in commission.
Since this wasn’t made clear to customers at the time of purchasing their PPI, the law firm believes they should be compensated.
The banks and credit cards took advantage of their position to secretly profiteer behind your back. This money should be repaid
Spokesperson at Harcus Parker
“For a start, this new claim is easy to understand.
“The banks and credit cards took advantage of their position to secretly profiteer behind your back. This money should be repaid,” said a spokesperson at Harcus Parker.
To challenge this claim, Harcus Parker is launching a group litigation.
This means it’s representing as many eligible claimants as possible under one challenge to resolve the common issues between them.
This should make processing these claims easier than reviewing the same issues thousands of times.
- To check your eligibility and join this challenge, you can fill in this form on Harcus Parker’s website.
So far, over a million people have visited this page, and over 300,000 have joined Harcus Parker’s group litigation.
We are hoping that this group’s legal action will put an end to PPI claims once-and-for-all in a simple and civilised manner
Damon Parker
“We are hoping that this group’s legal action will put an end to PPI claims once-and-for-all in a simple and civilised manner,” said Damon Parker, senior partner at Harcus Parker.
Martin Lewis, consumer champion and founder of MoneySavingExpert.com, previously said in a podcast that generally he’s against using claims handling firms.
But in this instance, he thinks it’s too complicated for people to handle themselves.
How this is linked to the Plevin case?
The legal challenge is closely linked to the Plevin case in 2014.
You can read more about this case here, but in essence, it ruled in favour of the claimant Susan Plevin against her lender Paragon Personal Finance under the Consumer Credit Act.
She argued she was not properly informed that 72% of her PPI policy was used for commission.
Did I have PPI and how do I make a claim?
One of the easiest ways to find out if you had PPI, and if you’re eligible for compensation, is to use Harcus Parker’s website.
The form takes less than 60 seconds to complete and, if you are eligible, you’ll be added to the group claim automatically.
To make your eligibility check as quick as possible, make sure you have your relevant documents at hand.
This includes any evidence of the credit agreement you believe had PPI.
Acceptable documents include a credit agreement or statement showing that you paid PPI premiums.
If you don’t have these documents, you can still check your eligibility with Harcus Parker.
Instead, it’ll reach out to your lender for further details – which may take some time.
How do I know if I’m eligible for PPI compensation?
According to Harcus Parker, you may be eligible to claim for PPI compensation if:
- You were sold PPI but have never made a claim
- You had PPI but were denied a pay-out; or
- You missed the August 2019 deadline.
To check your eligibility and join this challenge, you can fill in this form on Harcus Parker’s website.
The “no win, no fee” agreement with Harcus Parker
Harcus Parker’s group litigation works on a “no win, no fee” model.
In other words, if the challenge fails, and you don’t earn any compensation, you won’t be charged any fees by the law firm.
It’s only if it successfully wins back compensation that you’ll pay the company a fee for its services.
This stands at 35% of your compensation plus VAT.
Join Harcus Parker’s legal challenge