Millions face earlier deadline for PPI claims
Some will need to claim earlier than the 2019 cut-off – or miss out, warns Amelia Murray
Millions of people who were mis-sold payment protection insurance are being “misled” into thinking that they have until the August 2019 deadline, which could result in them receiving a “fraction of the redress”.
The Financial Conduct Authority, the City watchdog, launched a new campaign last week, warning people that they must complain to their bank about mis-sold PPI before August 29 2019. PPI was sold to cover loans in case people got ill or lost their jobs.
However, what the campaign fails to mention is that about 5.5 million people were contacted by their banks regarding PPI between 2013 and 2015 and given a three-year deadline to make a claim.
Dominic Lindley, a former leader of the Which? Financial Services policy team, said the alternative deadlines were “buried” on the FCA’s website.
He said: “The information about the earlier deadline is on the FCA’s website, but it is not on the home page and not referenced in the adverts. Millions of people could have just weeks or months ths left to complain. You can’t expectxpect people to recall a letter sent two or three years ago.”
The Financial Services s Consumer Panel, an independent statutory body, challenged the FCA’s communications last October. It said it was as not clear that the deadline for some consumers would be earlier than 2019.
In a letter, it said all banks should “proactively contact their PPI customers explaining the individual deadline that will apply to their complaint, whether or not they have already done this”. The FCA refused.
Unsuspecting consumers who miss their deadline, or are turned down, can still seek recourse following a court case known as “Plevin”. This focuses on complaints about the commission earned by the provider for the sale of the policy if it makes it unfair. However, payouts under these guidelines will be greatly reduced.
The FCA suggests that if your bank earned more than 50pc commission on the sale of the product they should refund anything over this. For example, if you discover that the bank earned 75pc commission from the sale of your policy, you will get just 25pc of your premiums refunded, plus interest.
As many as 64 million PPI policies were sold alongside loans, credit cards and mortgages, mostly between 1990 and 2010, although it’s unclear how many were mis-sold.
Since 2011 £27.4bn has been paid out by banks to customers who complained about how the policies were sold. However, the New City Agenda, a financial services think tank, said the true cost of the PPI scandal stood at £43.5bn.
PPI remains the most complained about financial product, according to the latest figures from the Financial Ombudsman Service. There were almost 90 90,000 complaints about PPI in t the past six months, which made up more than half of all cases reported to the se service.
The FCA said it had amend amended its website to make it clearer that some cases would be subje subject to an earlier deadline. A spokes spokesman said: “The message from our campaign is very cle clear – that people should ta take action now and not wait until the deadline to decide whether to m make a complaint.”
The FCA’s PPI deadline campaign