Step by step – A guide to getting your PPI payments back (without using a claims company)Tweet
You don’t have to pay a claims management company to get your mis-sold Payment Protection Insurance (PPI) payments back. If you’re prepared to do a little paperwork and make a few phone calls then you can claim back PPI payments on your own and avoid hefty fees.
Making a claim is fairly straightforward but it pays (literally) to know the process and all of the possible stumbling blocks along the way. In this mini guide we’ll look at:
1. Finding out if you have PPI
2. How to know if you were mis sold
3. How to make a claim – an Infographic
4. Five ways to ruin your claim
5. The four bank tactics that cut payouts
1. Finding out if you have PPI
If you’ve ever had a loan, mortgage, credit card or any type of credit or finance then you may have been sold a PPI policy alongside the borrowing. Even if you can’t remember signing up for a policy you may still have been paying for one as PPI was often included without the borrower’s permission.
Think hard about all those credit agreements because the average PPI refund is £2,700 per policy and you may have more than one mis sold PPI policy.
Checking your paperwork for PPI
If you don’t have your paperwork, you’ll need to ring your lender and request a copy of the agreement and any statements – but check with them how much copies will cost. Financial institutions in the UK are legally obliged to keep account-related paperwork for six years, if your credit agreement ended before then you may struggle to get anything from the lender.
Once you have your loan/credit card paperwork, check for mention of any of the following:
- Payment Protection Insurance
- Accident Sickness Unemployment cover
- Credit Insurance
- Credit Protection Insurance
- Loan Repayment Insurance
If you have statements then check the account activity section for any of the above, it should be in the same section as ‘Interest’, ‘Money In’, ’Money Out’ etc. In the case of credit cards; PPI was sometimes added separately at the point of card activation so be sure to check any related paperwork.
2. Was the PPI mis sold?
If you’ve found mention of PPI (or any of it’s aliases) then start thinking back to the point of the agreement – do you remember it being mentioned in the meeting/phone call/online application? Was PPI fully explained and optional?
To have been mis sold PPI, one or more of the following has to have happened:
- it was included in your borrowing without you knowing
- It was over-priced
- The lender said you had to take PPI if you want the credit
- The policy wasn’t fully explained to you
- The policy was completely useless as you weren’t eligible for cover (self-employed, ill, too old)
If your circumstances match any of these scenarios then you may have been mis sold PPI, if you can’t recall then it’s best to make a complaint and your lender can review the sale.
3. Making a PPI claim
Strictly speaking you aren’t making a claim, you’re making a complaint. This complaint is the start of the PPI refund process and involves submitting the complaint to your lender, hitting deadlines, responding to the letters, dealing with issues and taking the claim to the Financial Ombudsman (FOS) if necessary. To make a complaint you’ll need a copy of the Payment Protection Insurance Consumer Questionnaire which you’ll find on the FOS website.
The process is carried out in defined stages and can go one of a few ways depending on your individual circumstances. With this in mind it’s probably best to hand over to the infographic – go through the steps, stick to your guns and don’t be put off by rejection.
So that’s how you make a PPI claim on your own, be diligent and stay the course – it can sometimes seem like nothing is happening but stay motivated and remember: the banks love people who give up on their money.
Giving up is one way to scupper your chances of a refund here are a few more…
4. Five ways to ruin your PPI claim
1. Miss a deadline – You have 6 months to reply to your lender (or the FOS) regarding your complaint, miss this deadline and your claim is over.
2. Lie on your paperwork – You may think your case stands a better chance if you say certain things on your complaint letter – don’t lie. Your lender and the FOS will know the true details of the PPI sale so be honest, if you’ve been mis sold – your complaint will be upheld.
3. Not declaring savings – Some people think declaring savings might not look favourable, but if you had cash to support you then you didn’t need PPI. Declare your savings as it may mean the PPI was unnecessary.
4. Not enough detail – give as much information as possible about your circumstances at the time the policy was sold, including your income, other bills you had, how you would have been able to manage your finances in the event you lost your job etc. It’s easy for your lender to assume you needed PPI if you don’t explain your circumstances properly.
5. Settling for a low amount – Your lender may offer you a refund less than the full amount, this may seem tempting as it’s paid within 28 days. Hang on and get the full amount.
You should never settle for anything less than a full refund, which brings us onto the final section of this Mini Guide. Banks and lenders use a number of tactics to reduce the amount they have to pay out, it’s important you understand these tactics as it can seem like you’re getting a fair refund when you’re not…
5. The four bank tactics that cut payouts
- The low offer – where a lender will sometimes work a refund off an estimate instead of taking the time and effort to check how much is actually owed.
- Partial payouts are another classic strategy to save money on refunds, for example when credit card lenders refund mis sold PPI payments on an account from 2005 to 2012 when they should be refunding from when the card was taken out in 2001.
- ‘Upheld in part’ is almost unbelievable, considering lenders already have a terrible reputation – in this situation the lender tells you that the PPI was mis sold but you should have had some protection, so they offer you the difference between your full refund and the cost of their cheapest cover at the time of issuing the loan.
- Issuing a wrong refund because it’s cheaper – Say you request a PPI refund on one credit card and you have another card with the same lender that you haven’t complained about yet. lenders offer a refund on the other card because it’s a cheaper payout and ignore the one you actually complained about.
When assessing a compensation offer, make sure you know what you’re owed and bear in mind that there may be a legitimate reason why you lender has not issued a full refund. Such as you have an existing loan/credit card with them and your payout (or some of it) has gone towards repaying the borrowing.
You now know how to make a PPI claim yourself and what to look out for – how smoothly it goes depends on the lender, their workload, the competence of their staff and how accurate you are with your form-filling. Remember to triple-check all the information you give and spell everything correctly – banks LOVE mistakes as they’re a great excuse to delay responses and payouts.
This guide was written for Happier.co.uk by John Gregory, Head of PR at the PPI Claims Adviceline. For more detailed information on the intricacies of claiming back PPI yourself visit http://www.ppiclaimsadviceline.com/advice.