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A plan to let banks set a time limit for payment protection insurance claims is being considered by the City regulator, creating the risk that victims of the huge mis-selling scandal will be left out of pocket. It is estimated only about half the total PPI liability that banks face has been claimed: compensation payouts for mis-sold policies currently stand at around £13billion but the eventual bill could reach £25billion. In an attempt to put a lid on claims the British Bankers' Association is pushing the Financial Services Authority to impose a time limit for claims to be lodged, the Times reported today. The deadline would be in the summer of 2014.
PPI is the insurance that was sold alongside loans and credit cards to cover repayments if the borrower was unable to because of unemployment. It was widely mis-sold with the costly policies pushed onto many would never be able to make a claim. PPI contained sky-high profit margins for banks and costs were often hidden by adding them to the loan amount, leaving customers to pay for all the cover up front, with interest attached. Sometimes the insurance was added to accompanying loans and cards without permission. Mis-selling claims have exploded in the last few years, fueled by an industry of claims management companies that offer to take up the cases of victims in exchange for a fee. The firms have led to far greater numbers claiming but have themselves been the subject of complaints...Read more here: Banks push for PPI claims deadline that would leave victims scrabbling for compensation
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Banks push for PPI claims deadline
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#15corpio commentedEditing a commentCitizens Advice responds to the news today that banks and the FSA are discussing a deadline for when all PPI claims must be made. Citizens Advice Chief Executive Gillian Guy said: "A deadline for mis-sold PPI claims could only be fair if, in exchange, the banks comply with an obligation to contact every customer who was sold PPI to tell them they may be entitled to make a claim....Read more here: PPI deadline only fair if banks tell PPI customers about their right to claim
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#25corpio commentedEditing a commentThe Financial Services Authority (FSA) has been approached by the British Bankers' Association (BBA) to discuss the potential for introducing a time limit for Payment Protection Insurance (PPI) complaints - if the banking industry funded a sufficiently widespread advertising campaign to ensure consumers are aware of the PPI issue and how to complain.Our key priority is to ensure consumers are protected, so the FSA Board would need to be convinced that any proposals would be in the interests of consumers.....Read more here: FSA Statement on PPI
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#35corpio commentedEditing a commentThe OFT is calling for the legal profession's complaint handling procedures to be further simplified after it published research today showing that only one in eight (13 per cent) dissatisfied customers goes on to make a formal complaint. The low level of complaints was found to be largely due to uncertainty about how or where to complain and scepticism about whether complaining is worth the effort. The research also shows that around 460,000, or one in seven, of the three million people using the UK's legal profession each year are dissatisfied with the service they receive. The findings form part of wider research commissioned by the OFT to understand how recent changes to the regulation of lawyers, following the Legal Services Act in 2007, have impacted on consumers. Currently, for complaints not resolved by the provider, the consumer is often asked to distinguish between complaints about the service provided or the conduct of the provider before directing it to the appropriate body. Complaints about the conduct of a lawyer can be sent to one of 10 approved regulators, depending on the legal profession involved.....Read more at OFT website: Consumers reluctant to complain about legal profession, says OFT - The Office of Fair Trading
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