16:10 07 November 2012
With people reclaiming Payment Protection Insurance (PPI) on mis-sold or incorrect cover on their policies, the UK’s banks have been affected.
Banking PPI history
The news first came in 2010 when the Financial Services Authority (FSA) said that banks had to cover the cost of people reclaiming PPI. In response to this, the British Bankers' Association (BBA) took the matter up in court and ceased their payments with regards to payment protection insurance.
This did not last long however, and by April 2011 BBA lost their legal battle and were to deal with PPI claims.
Action taken on PPI
The FSA has since investigated the case of mis-sold PPI, with 2005 seeing 24 companies being fined for false sales of payment protection insurance. The following reasons relate to suitable grounds for action to be taken with regards to reclaiming PPI:
• A customer not knowing a PPI policy was included in a sale
• A PPI policy not meeting a customer’s needs
• A customer being pressured to take out payment protection insurance
So far, according to some reports, it is thought that at least 2million people have been mis-sold PPI’s. The FSA stated that last year in the first six months a staggering £215million was paid out in refunds for PPI.
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