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MSE News: £60m refund for mortgage protection hike victims

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  • di3004
    di3004 Posts: 42,579 Forumite
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    marshallka wrote: »
    Ok thanks for that. I think it went up by something like £10 a month and we have never had to claim on it ever and we have never defaulted on it either. Also we have never changed the amount of income protection. I will just have to read up a little more then and see.

    That is a lot more than our's Marshallka and we have claimed as well.;)
    The one and only "Dizzy Di" :D
  • marshallka
    marshallka Posts: 14,585 Forumite
    edited 7 October 2009 at 8:04PM
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    di3004 wrote: »
    That is a lot more than our's Marshallka and we have claimed as well.;)
    I take it you have not paid it either for a while since hubby was out of work as you were claiming on it. Ours was only raised this year I think. It says here


    The ABI's Director General, Stephen Haddrill, added:
    "Mortgage payment protection insurance customers do not need to take any action, although it is important that they continue to pay their premiums to ensure that their cover continues."
    "Their mortgage lender or insurer will contact them if their policy is affected in any way," he said.


    Following discussions initiated by the FSA with relevant trade bodies and some firms, the industry has responded positively by agreeing to:
    • proactively refund increases in premiums, and reverse any reductions in cover, for customers who have experienced these changes to their policy in 2009;
    • offer to reinstate policies where a customer had cancelled it within two months of an increase in premium or reduction in cover made during 2009;
  • di3004
    di3004 Posts: 42,579 Forumite
    edited 7 October 2009 at 9:12PM
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    marshallka wrote: »
    I take it you have not paid it either for a while since hubby was out of work as you were claiming on it. Ours was only raised this year I think. It says here


    The ABI's Director General, Stephen Haddrill, added:
    "Mortgage payment protection insurance customers do not need to take any action, although it is important that they continue to pay their premiums to ensure that their cover continues."
    "Their mortgage lender or insurer will contact them if their policy is affected in any way," he said.







    Following discussions initiated by the FSA with relevant trade bodies and some firms, the industry has responded positively by agreeing to:
    • proactively refund increases in premiums, and reverse any reductions in cover, for customers who have experienced these changes to their policy in 2009;
    • offer to reinstate policies where a customer had cancelled it within two months of an increase in premium or reduction in cover made during 2009;

    Yes we still pay for the monthly repayments.;)
    We still have to pay it as usual....it carries on working or not.

    Its about £16 a month, it was just over £11 a month before it went up, but if you stop paying it then your not covered, so it carrys on.

    It reminds me a little of the protection with some policies, (this not mortgage related) like Lloyds TSB, even if protected, when the insurer pays out, you still have to make the monthly repayments for this, so its a little like in one hand out the other and vica versa.
    Apart from with a loan, you pay the same amount as the loan is worth and the income protection is worked out a lot less a month.
    The one and only "Dizzy Di" :D
  • di3004
    di3004 Posts: 42,579 Forumite
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    Found more info here from the FSA website.

    http://www.fsa.gov.uk/pages/Library/Communication/PR/2009/135.shtml


    FSA and firms reach agreement on MPPI


    media.gif

    FSA/PN/135/2009
    7 October 2009

    The Financial Services Authority (FSA) and Mortgage Payment Protection Insurance (MPPI) firms have agreed an industry-wide package of measures for consumers, including refunds of around £60 million.
    The industry has acted in response to FSA concerns over recent increases in premiums and reductions in what customers are covered for under their policy. The FSA’s concerns centred on the terms permitting these changes, and how clearly they were disclosed. The FSA expects its concerns to be addressed by the agreement reached.
    Following discussions initiated by the FSA with relevant trade bodies and some firms, the industry has responded positively by agreeing to:
    • proactively refund increases in premiums, and reverse any reductions in cover, for customers who have experienced these changes to their policy in 2009;
    • offer to reinstate policies where a customer had cancelled it within two months of an increase in premium or reduction in cover made during 2009;
    • freeze premiums and cover for existing customers for at least the remainder of this year; and
    • amend MPPI contracts to ensure that all customers are made aware of the circumstances in which firms have the right to vary premiums and cover.
    Jon Pain, managing director of supervision at the FSA, said:
    "The FSA welcomes this positive move by MPPI firms to reverse recent changes in premiums or cover which will put affected customers back in the position they were in before the policy was changed. It will also give all MPPI customers clarity about when and why firms will be able to vary these in future.
    "This clarity will provide the basis for MPPI to remain a valuable option for many mortgage customers who wish to take out protection, alongside the mortgage commitment they are taking on."
    Firms will contact customers if their policy is affected, and will make all refunds by the end of June 2010.
    The one and only "Dizzy Di" :D
  • marshallka
    marshallka Posts: 14,585 Forumite
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    di3004 wrote: »
    Yes we still pay for the monthly repayments.;)
    We still have to pay it as usual....it carries on working or not.

    Its about £16 a month, it was just over £11 a month before it went up, but if you stop paying it then your not covered, so it carrys on.

    It reminds me a little of the protection with some policies, (this not mortgage related) like Lloyds TSB, even if protected, when the insurer pays out, you still have to make the monthly repayments for this, so its a little like in one hand out the other and vica versa.
    I thought it stopped if you claim on it for the time you are claiming? So if you claim on a policy you still have to carry on paying the monthly fee although they are paying you? I am totally lost here? I really did not know that. We pay about near on 50 a month now I think since it went up. Maybe £45 closer but I know it went up a lot and I was moaning about the other week.
  • di3004
    di3004 Posts: 42,579 Forumite
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    marshallka wrote: »
    I thought it stopped if you claim on it for the time you are claiming? So if you claim on a policy you still have to carry on paying the monthly fee although they are paying you? I am totally lost here? I really did not know that. We pay about near on 50 a month now I think since it went up. Maybe £45 closer but I know it went up a lot and I was moaning about the other week.

    Nope it carries on apparently.

    Even though it does not cover the whole lot of the mortgage, as we are unable to update it now until he returns to employment, then obviously we will then be paying more again, to cover the mortgage.
    Ours went up earlier in the year as well......only the once though.
    The one and only "Dizzy Di" :D
  • di3004
    di3004 Posts: 42,579 Forumite
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    Marshallka, we have arrears now due to our lender not allowing us to go to interest only.......:confused:we thought over £400 would help of the insurance and they did not want to know, I have had some help on this and its gone to the FOS, Lloyds have played a big part in this as well, as the mortgage is Chelt & Glos, it was pushed on for lloyds to help us and they don't want to know.
    The one and only "Dizzy Di" :D
  • marshallka
    marshallka Posts: 14,585 Forumite
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    di3004 wrote: »
    Marshallka, we have arrears now due to our lender not allowing us to go to interest only.......:confused:we thought over £400 would help of the insurance and they did not want to know, I have had some help on this and its gone to the FOS, Lloyds have played a big part in this as well, as the mortgage is Chelt & Glos, it was pushed on for lloyds to help us and they don't want to know.
    So you are paying £400 from the insurance that you have and then that is not covering the interest? They cannot threaten repossession on this though as you are paying the interest I assume by paying £400. C and G are now with LLoyds like my mortgage is now with them being IF. I know they are not the best to deal with either. Are FOS able to help with Mortgage problems then? When did they have jurisdiction over issues like this?
  • di3004
    di3004 Posts: 42,579 Forumite
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    marshallka wrote: »
    So you are paying £400 from the insurance that you have and then that is not covering the interest? They cannot threaten repossession on this though as you are paying the interest I assume by paying £400. C and G are now with LLoyds like my mortgage is now with them being IF. I know they are not the best to deal with either. Are FOS able to help with Mortgage problems then? When did they have jurisdiction over issues like this?

    Well we have sent to the FOS anyway as we have been completely ignored, and charges have added up.

    We had some help from someone who posts on this and CAG who deals with these issues all the time, and Chelt and Glos will accept nothing else but the £745, so we have to pay what we can on top of the £400 of the insurance.
    They do not listen, we have even asked due to our situation if they can add the arrears on the end of the mortgage, as we should be entitled to help, due to support schemes, but again they are refusing us.
    The one and only "Dizzy Di" :D
  • di3004
    di3004 Posts: 42,579 Forumite
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    It works out £580 for interest only.
    The one and only "Dizzy Di" :D
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