Mis Sold Credit Card PPI
It is estimated that there are currently around twenty million active payment protection policies in the UK. It is not known how many of these policies have been mis-sold, but many of them are attached to credit cards.
PPI on credit cards is charged slightly differently to PPI on loans or mortgages. Rather than being applied as a lump sum at the start of the agreement, it is usually calculated and applied on a monthly basis. Costs vary, but are usually in the region of 79p per £100 owed on the card. This means if your balance is zero you will pay no premium. Phrased this way the cover sounds inexpensive and, under these circumstances, it is, but if you owe a substantial sum on your credit card your monthly PPI bill could be very high. For example, if you owe £7,000 you may pay in the region of £55.30 per month. This is the equivalent of £663.60 per year! Many people who sign up for credit card PPI are shocked to discover just how expensive it can be. Fortunately, if your lender failed to make the costs clear this could constitute mis-selling and you could make a claim and recover your money.
Other examples of mis-selling include where a policy is added without a customer’s agreement or knowledge and where a customer bases their decision to take the cover out on information that later proves to be incorrect or incomplete.
Another area of mis-selling concerns policies being sold to customers who do not want or need them. For example a customer may not need a policy if they have secure employment or are entitled to receive full sick pay from their employer. In other cases a customer may actually be ineligible for the cover – for example if they are self-employed. Unfortunately, some people who were not eligible for the cover were still sold it – this is a clear case of mis-selling for which you can make a claim.