Just when we the banks thought the PPI scandal might be over and done with a new court ruling means they are on the hook for millions more as customers can now make a claim for hidden commission fees.
PPI or Payment Protection Insurance were sold across the UK to more than 60 million people between 1990 and 2010. Policies were sold as part of loan agreements, credit cards and mortgages. PPI was meant to cover people if the lost their job, became ill or could not repay for any reason. One of the main issues with PPI was that it was sold to people who did not need it, did not meet the criteria for claiming and even people who did not know they had purchased it. The cut-off deadline for PPI claims was August 2019 and banks could stop paying out. However, it later emerged that banks were also taking secret commissions on these policies, some as large as 70 to 95 percent.
In 2019, Beverly Potter took her credit card company Egg to court after discovering the firm had taken a 95 percent on her £17,000 loan, she took out in 2006. She claimed she was persuaded to take out the insurance to cover the large loan but was not told that 95 percent would go towards commission from AXA insurer to Egg. Egg tried to stop the claim by saying she was too late, and the PPI deadline had already passed. However, the courts did not agree with Egg and awarded Beverly £7,954 in compensation. Following this ruling the Bank appealed and on two separate occasions lost. The judge said she would not likely have taken out this loan if she knew the commission was excessive.
Following this ruling, experts now believe the PPI claims should continue and people who have previously been denied a payment or have not made one, could be entitled to now. Those who have already had a successful PPI claim will not be able to claim again but for those whose claim may be in question, this new news could be promising. If you think you have a claim you will need to have been sold PPI before April 2007 and still have been paying for the attached product on or after April 2008. Experts believe that there are millions still to pay out to customers who have been mis-sold and people can make new claims for up to £40,000 after the latest court ruling.