Category: 
December 3, 2008
We took out a large loan, & at the time took out a payment protection insurance. We were just told that it would cover us if we were ill; or out of work.. We have just applied to cancel this insurance ,as we found out it only covered us for the first five years of the loan & thought it would lower the monthly premium. The bank will let us cancel it but when i asked if that would lower the monthly amount ,by the £68 that we pay for the insurance per month we were told “oh no” it won’t lower your payments it just means you wont have the insurance.. When i questioned this; the person couldn’t answer my query..
Surely this is a scam.. ANY IDEAS ??? SURELY THEY CAN’T DO THIS…
You need to contact the company providing the payment protection for the refund. They were paid in full by whomever lent you the money, so they would be the ones to refund the money (most likely with a penalty).
When you took out your loan the bank paid the payment protection the full amount of the premium for the life of the loan. That’s why it won’t reduce your monthly payment. But if you get a refund from the payment protection company you’ll have the money and you can use that money to help pay off the monthly balance.
There are so many people who don’t contact payment protection, credit life and credit disability insurers when they pay off their cars early, or if the cars gets traded in or totaled. So many people miss the opportunity to get a refund on the unused premiums. And the banks don’t tell you what do do because the front line operators often don’t know you can do this.
Best of luck!
Horaayy..there are 6 comment(s) for me so far ;)
Lots of this insurance was mis-sold and you will be able to apply for a decent rebate - EXACTLY FOR THE REASONS YOU HAVE STATED.
Go here and read all about it
http://www.moneysavingexpert.com/reclaim/ppi-loan-insurance
My friend works on the claims, and he said folk were getting thousands refunded.
Hope this helps.
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Put in a complaint with your government officials.
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Sorry but I just have a question.Did you pay a once only premium for the protection?Or do you pay for it monthly?If a once only payment then thats that,you stick to it.If it's monthly and not part of the contract in the loan then you just cancel the monthly payment.Last,if it's monthly and part of the loan contract then your stuck with it.It may be that the £68 you pay monthly will reduce the loan period.In last resort get an appointment wih the bank manager,he will be able to answer.If your not happy with his explanation then you have LAUTRO.your local MP and then the Ombudsman as back up.First get the facts from Bank MANAGER.Your talking a lot of money!
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It gets added ontop of the loan, so it becomes part of the loan itself. If you were not told this, or it wasn’t clear you have a right to challenge it. Speak to the Financial Ombudsman Service.
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The payment for the insurance
was made in advance by the bank
and this amount was added
to your loan, so you still have to pay
the insurance fee, because you owe it
to the bank and not to the insurers,
so if your 5 years is not up yet, don`t cancel
the insurance.
References :
You need to contact the company providing the payment protection for the refund. They were paid in full by whomever lent you the money, so they would be the ones to refund the money (most likely with a penalty).
When you took out your loan the bank paid the payment protection the full amount of the premium for the life of the loan. That’s why it won’t reduce your monthly payment. But if you get a refund from the payment protection company you’ll have the money and you can use that money to help pay off the monthly balance.
There are so many people who don’t contact payment protection, credit life and credit disability insurers when they pay off their cars early, or if the cars gets traded in or totaled. So many people miss the opportunity to get a refund on the unused premiums. And the banks don’t tell you what do do because the front line operators often don’t know you can do this.
Best of luck!
References :