PPI Can Offer Benefits
There has been much debate over Payment Protection Insurance (PPI) after it was found that the product was missold to hundreds of thousands of people in the UK. Whilst the product can be a great financial protector for those buying it in the right way, missold PPI cases have caused a huge amount of negativity. However, new laws are coming into force, offering those taking out Mortgage Payment Protection Insurance (MPPI) and other PPI products, increased security against selling.
The new rules are aimed at providers of PPI not being able to force products upon vulnerable people who are trying to take out loans and credit agreements. One of the leading reasons why so many cases of missold PPI arose is because, when taking out much needed loans, consumers were advised that PPI was necessary. However, this was not correct, and the purchase of PPI is optional.
With this in mind, PPI can no longer be sold alongside a mortgage or credit agreement, and a seven-day period must have passed between the loan sale or personal PPI quote and the actual selling of insurance. Single premium PPI policies can no longer be sold, whilst providers of PPI must make clear to customers that the protection is optional and must offer full transparency of prices.
Payment Protection Insurance (PPI) has been involved in a huge scandal over the past year, with consumers becoming aware of the fact that they may have been missold insurance. However, though policies were wrongly sold in thousands of cases, the insurance product can offer a number of benefits if taken out in the correct situation, offering financial support at a time of strife.
Missold PPI largely occurred when consumers took out credit agreements and they were told that the insurance policy was vital to ensure approval. In some cases it was a tacked on extra, which consumers weren't made aware, and in other situations it was sold to people who couldn't take advantage of payouts such as those who are self employed or retired.
For some consumers, PPI is actually a beneficial product, providing the financial means to get by if they become sick and unable to work, or are made redundant. When taking out a credit agreement such as a mortgage or personal loan, PPI offers a way to protect the contractual repayments that are required. For those who are unable to pay through job loss or sickness, a payout can fund repayments to offer those who are insured a little security. A wider range of products is also now becoming available, offering payouts that are enough to cover extra such as utility bills too.
With missold PPI having a spotlight put upon it and thousands of people currently claiming compensation, it is unsurprising that many individuals seek to avoid this protection. However, for those who want genuine cover to protect themselves, PPI can remain a positive product.
The stigma of PPI is likely to remain with customers for a long time, but the industry is taking steps to ensure that product can offer people financial support in times when they most need it.
About the Author
Colin Hartness is marketing director of Fast Track Reclaim specialising in a fast efficient payment protection insurance (PPI) reclaim service to UK consumers. Fast Track Reclaim will review all client agreements for free to determine if they are eligible for a PPI Claims and will strive to attain the maximum compensation on their behalf. For more information visit http://www.fasttrackreclaim.com
Tell others about
this page:
Comments? Questions? Email Here