Are single PPI premiums fair?

marshy27

I've enquired about reclaiming for all my ppi payments to lloyds tsb and now im having to write a letter to the financial ombudsman service as lloyds have rejected the claim.

What i would like to know though is, is it fair that i stll have to continue basically paying for the ppi although i no longer have it? Here's my info to try and make it easier for me to explain.

I took out the loan in 2007 and the ppi was added to the loan to make a total loan payment of £203.77
The total £203.77 is a combined total of the cash loan and ppi. £161.61 for the PPI and £42.13 for the PPI.
If i cancel the PPI, my monthly repayments just for the loan will be £190.23 . This means that im still paying £28.62 for the PPI although its of no use to me.

On my loan agreement there are PPi rebate examples of how much i'd get if i cancel it half way through the loan, which says i get roughly £300-350 rebate. I didnt take much notice of this when i took out the loan because it says this in the terms and conditions "If you decide to cancel the LPI policy the LPI loan will also be cancelled. The cash loan will continue and we will collect only the monthly repayment of the cash loan". To me this is saying that i will only continue paying the £161.61. I was happy with this paragraph in the terms and conditions which is why i didnt cancel the PPI policy within the 30 days.

Now is this fair of them to continue charging me £28.62 for the PPI? As far as im concerned i dont find it fair because if i was told of this at the beginning of the loan i wouldnt of taken the ppi out. For that reason i believe i have been mis sold the PPI and i also was not made aware of the full facts at the time of taking out the loan.

What are your opinions? Im writing a letter stating this to the FOS and was wondering what my chances of winning?

marshy27

Here's a copy of what i've wrote to the FOS.

On 7/6/2007 I took out a loan online with Lloyds TSB for £7500. The total amount for the cash loan was £9698.40 and the total for the Loan Protection Insurance was £2527.80. This gave me a total loan of £12226.20 which was to be paid by 60 monthly instalments’ of £203.77. Of the £203.77, £161.64 was the monthly repayment for the cash loan and £42.13 was for the PPI
On 25th January 2010 I phoned Lloyds Tsb to ask for the PPI to be removed. I was told that if I cancel the PPI that the loan will have to be re financed and that I will have to sign a new loan agreement as another loan will have to be taken out to pay off the existing loan. I have looked at my loan agreement and there is nothing in there that says anything about having to refinance and sign another agreement to cancel the PPI. Also it did not state anywhere during the process of taking out the loan online that the loan will have to be re-structured and that a new agreement will have to be signed.

If I cancelled my PPI I assumed that I will be paying £42.13 less a month as that’s how much I am paying for the PPI and then will continue paying only the cash loan repayment of £161.64. Apparently this is not how it works. I have been told that because the PPI was “front loaded”, the full £42.13 does not get deducted from the £203.77. In fact, if I did cancel the PPI my payments will only reduce to £190.23. So although I no longer will want the PPI I will still be paying £28.59 for it as my repayments for the loan are only £161.64. So therefore I am still paying an extra £28.59 on top of my cash loan repayment for basically nothing. If this process of cancelling the PPI was explained to me during taking out the loan then I would not of taken out the PPI policy.

After looking at my loan agreement it states the following under “OTHER TERMS” in AVAILABILITY OF LOAN 1.3 and I quote “ If you decide to cancel the LPI policy the LPI loan will also be cancelled. The cash loan will continue and we will collect only the monthly repayment for the cash loan”. To me, this means that if I cancel the PPI then I will only have to continue the cash loan repayment of £161.64. Because of that paragraph in my terms and conditions I felt there was no need to cancel the PPI or question it before the 30 days cancellation period. So I was surprised when I found out that the payments upon cancelling the PPI will actually be £190.23.

On 28th January I wrote to Lloyds TSB stating all of my above concerns and requested a full refund of all premiums, and subsequent interest on these payments, that I have paid to date, as well as 8% statutory interest. On 14th February I received a final response stating that if I did not want the PPI then I shouldn’t of took it out when I applied for the loan and that they are not going to act in my favour and that I may ask the Financial Ombudsman to look at my complaint. They didn’t even address my concerns in the final response letter.

Also, at the time of taking out the PPI, I was not aware the my pre existing illness of Asthma which I have had since birth is not covered as I was not asked about any health problems at the time of taking out the loan online.
For all these reasons as well as the terms and conditions regarding cancelling PPI not being properly and fully explained to me I feel that I have been miss sold the PPI policy.

Please find enclosed a copy of my loan agreement and final response letter

What you think? I personally dont think they're gonna rule in my favour because when i spoke to the FOS on the phone they said they cant see how its been mis-sold :eek:.

di3004

marshy27 wrote: »

I've enquired about reclaiming for all my ppi payments to lloyds tsb and now im having to write a letter to the financial ombudsman service as lloyds have rejected the claim.

What i would like to know though is, is it fair that i stll have to continue basically paying for the ppi although i no longer have it? Here's my info to try and make it easier for me to explain.

I took out the loan in 2007 and the ppi was added to the loan to make a total loan payment of £203.77
The total £203.77 is a combined total of the cash loan and ppi. £161.61 for the PPI and £42.13 for the PPI.
If i cancel the PPI, my monthly repayments just for the loan will be £190.23 . This means that im still paying £28.62 for the PPI although its of no use to me.

On my loan agreement there are PPi rebate examples of how much i'd get if i cancel it half way through the loan, which says i get roughly £300-350 rebate. I didnt take much notice of this when i took out the loan because it says this in the terms and conditions "If you decide to cancel the LPI policy the LPI loan will also be cancelled. The cash loan will continue and we will collect only the monthly repayment of the cash loan". To me this is saying that i will only continue paying the £161.61. I was happy with this paragraph in the terms and conditions which is why i didnt cancel the PPI policy within the 30 days.

Now is this fair of them to continue charging me £28.62 for the PPI? As far as im concerned i dont find it fair because if i was told of this at the beginning of the loan i wouldnt of taken the ppi out. For that reason i believe i have been mis sold the PPI and i also was not made aware of the full facts at the time of taking out the loan.

What are your opinions? Im writing a letter stating this to the FOS and was wondering what my chances of winning?

Hi there

Good luck with this.
May I ask if LLoyds actually given you the final decision?
Did they not give you the opportunity to write back to them with further information?

Thought I would mention this just in case, if they have not given the final response, you could write back with the information you have provided above which may give them another outlook on the decision.

Otherwise if final your doing the right thing by going to the FOS.;)

maxdp

Marshy did you have to opt into the insurance or was it already included and you had to opt out of the insurance?

marshy27

di3004 wrote: »

Hi there

Good luck with this.
May I ask if LLoyds actually given you the final decision?
Did they not give you the opportunity to write back to them with further information?

Thought I would mention this just in case, if they have not given the final response, you could write back with the information you have provided above which may give them another outlook on the decision.

Otherwise if final your doing the right thing by going to the FOS.;)

This was their only and final responce as it stated that on the letter. I was suprised they didnt give me a second chance to write in.

maxdp wrote: »

Marshy did you have to opt into the insurance or was it already included and you had to opt out of the insurance?

Neither. I chose to take out the PPI as it thouught it would benefit me if i was to lose my job etc etc. I understand that it sounds like i havent been miss sold but i was hoping i can have them on a mis-sale due to them not explaining the terms and conditions correctly.

If i cant get the premiums refunded then fair enough. I will keep pushing them to remove the FULL amount of PPI though as going by their terms and conditions, thats what should happen. I agreed to the PPI based of that so if that not true then in my eyes i've been mis-sold the ppi.

In my eyes they're basically saying to me, heres PPI for the duration of your loan for £42.13 a month. If you want to cancel the PPI you can and you will no longer have to pay £42.13 for PPI. BUT when it comes to cancelling it they're saying, actually forget the terms and conditions, we're gonna continue charging you £28.62 for the fun of it. And thats not a mis-sale?

Same thing has happened to this member but hasnt had any update http://forums.moneysavingexpert.com/showthread.html?t=2081327

di3004

Hi there

This is what happened with my ours as well, even though we did have an offer, but we are not happy with it, and they made quite a few mistakes on dates too, and did not go into full investigation of our complaint, so due to this as we were not given another opportunity I did write back anyway and told them of some mistakes they made and they did not investigate on all areas of the reasons given.

Due to this, we have since heard they are looking into this again and are to get back to us as soon as possible, I did not expect them to do this, but it seems like LLoyds are not giving everyone the opportunity to write back with further information.

Read this letter/email here sent from LLOYDS:

Dear ,


I apologize for the delay in getting a response to your letter that you have sent in, at present we are waiting for a letter to be issued regarding your concerns.


It will be looked into for you and also all your concerns will be dealt with in the letter again I apologize for the delay and it has been forwarded to the right department.



Kind Regards


R(Customer Care)

drib0704

hi i dont know how to use these things properly,but here goes
i took out a single premium loan a couple of years ago with barclays over the phone ,obviously not remembering the phonecall,i dont recall what was said to me about the policy,but i was and still am self-employed,i will have the paperwork but not being financially knowledgeable its all too much for me .i have just cancelled the policy but obviously still have to pay it all,and am wondering if i have a claim, the policy alone is around £4000 please help!

marshy27

di3004 wrote: »

Hi there

This is what happened with my ours as well, even though we did have an offer, but we are not happy with it, and they made quite a few mistakes on dates too, and did not go into full investigation of our complaint, so due to this as we were not given another opportunity I did write back anyway and told them of some mistakes they made and they did not investigate on all areas of the reasons given.

Due to this, we have since heard they are looking into this again and are to get back to us as soon as possible, I did not expect them to do this, but it seems like LLoyds are not giving everyone the opportunity to write back with further information.

Read this letter/email here sent from LLOYDS:

Dear ,


I apologize for the delay in getting a response to your letter that you have sent in, at present we are waiting for a letter to be issued regarding your concerns.


It will be looked into for you and also all your concerns will be dealt with in the letter again I apologize for the delay and it has been forwarded to the right department.



Kind Regards


R(Customer Care)

Seems like you have been lucky enough to get lloyds to have a second look at the problem for you. I spose there's no harm in giving them a ring in the morning to see if i can have a proper detailed response. I'll still send off the complaint form to the FOS as they said there's a maximum 9 month waiting list/backlog so better to get it in sooner than later.

I've spend hours searching this site trying to find someone who's been in the same situation as me but i can only find the 1 person. Is there really nobody else out there thats had the same problem lol?

marshallka

marshy27 wrote: »

Seems like you have been lucky enough to get lloyds to have a second look at the problem for you. I spose there's no harm in giving them a ring in the morning to see if i can have a proper detailed response. I'll still send off the complaint form to the FOS as they said there's a maximum 9 month waiting list/backlog so better to get it in sooner than later.

I've spend hours searching this site trying to find someone who's been in the same situation as me but i can only find the 1 person. Is there really nobody else out there thats had the same problem lol?

Hi, have been told that for certain by FOS that the waiting list back log is only 9 months maximum? This is news to me!!

maxdp

Nine months my !!!!. I have one with Lloydswhich still has not been placed with an adjudicator that is 2 years old at this moment.

marshy27

marshallka wrote: »

Hi, have been told that for certain by FOS that the waiting list back log is only 9 months maximum? This is news to me!!

Yea, i phoned them yesterday to make sure i had all the right documents to post and when i asked how long it'll roughly take she said 9 months max but they're starting to get through the claims quicker so might be sooner.