Were you mis-sold your loan payment protection insurance cover?
- 9TH SEPTEMBER 2007
After a super complaint by the Citizens Advice to the Office of Fair Trading in 2005, the Financial Services Authority began an investigation into the sector which cumulated in several high street names receiving fines for mis-selling payment protection. If you bought your loan payment protection plan alongside your loan from the high street lender then you should ask yourself if you were mis-sold your loan payment protection insurance cover.
Loan payment protection insurance cover is taken out to ensure that if you have loan repayments to make each month and were to find yourself unable to work through accident, sickness or unemployment you would still have a monthly income with which to meet the repayments. A policy when bought to suit your circumstances would begin to pay out after you have been out of work, usually for 30 days or more, and continue to pay out a tax free sum of money for 12 months and with some providers 24 months.
However there are exclusions within a policy and it is these exclusions that have caused the majority of mis-selling. In cases of mis-sold policies there had been a lack of information and in some cases consumers were told that they had to buy the policy with their loan. When taking your loan all lenders should make you aware that the cover exists, and also that it can be bought independently from a standalone provider such as British Insurance.
When buying a policy you should also be made aware of the many exclusions within all policies and there are many of them. Some of the most common reasons why you might not be able to claim on a policy include not being in full time employment, suffering from a pre-existing medical condition and being self employed.
Loan payment protection insurance covercan be a lifeline if it is bought correctly and a standalone provider will always give you the cheapest quotes for the premiums so shop around, get quotes from standalone providers such as British Insurance and make use of their experience and knowledge to ensure that you aren’t mis-sold your loan protection.
