When is PPI not PPI? Skycard & Payment Break Plan

willowthecat

Hello Everyone!

I'm helping a friend to reclaim what we believe to be PPI from Skycard (now Barclaycard) and was hoping for some help from anyone who has successfully (or otherwise), to obtain a refund of payments.

At some point between December 2006 and June 2007, Skycard started charging Payment Break Plan (don't know when exactly as he doesn't have all his statements for that timeframe).

My friend doesn't remember ever agreeing to this "PPI" and in actual fact has always declined this type of insurance when taking out a loan.

We've made a request to Barclaycard under s78 CCA 1974 and received a response that they are unable to provide the required details under the Act.

What they did send instead was a photocopy of the terms & conditions of Skycard, which judging by the microscopic writing of "06/06" at the bottom of the page, which we're presuming means they were in force from June 2006.

I'll quote some relevant bits about what these T&Cs say about the Payment Break Plan...

12: OPTIONAL PAYMENT BREAK PLAN TERMS

12.1 The Payment Break Plan ("The Plan") is optional and not insurance.

...

12.4 Once you have enrolled, you can activate The Plan if one or more of the activation events set out below occurs...The activation events are:
(a) you or your partner become unemployed involuntarily and suffer a loss of at least 25% income.
(b) you or your partner become sick, disabled or have an accident and suffer a loss of at least 25% income.
(c) you or your partner take leave from work to care for members of your family who are either incapacitated and/or your children and you suffer a loss of at least 25% income.
...
(e) you or your partner become hospitalised due to a medical condition.
(f) you or your partner are on jury service.
(g) your partner dies

I'm not a financial expert but surely this is PPI despite the claim from Skycard that it isn't insurance?

I'm about to draft a second letter to Barclaycard, this time actually making a request for PPI refund. I'm 90% certain though that they'll send a response that the Payment Break Plan wasn't PPI so tough!

I would love to know if anyone has had any success with reclaiming for this Payment Break Plan or if they can point me in the direction of any FOS decisions (favourable or not) where a company purports that a PPI isn't a PPI.

If I can, I want to fill the second letter with plenty of ammunition :rotfl:

Many thanks in advance for any help!

dunstonh

We've made a request to Barclaycard under s78 CCA 1974 and received a response that they are unable to provide the required details under the Act.

Wouldnt have made any difference anyway as how you have written it, it sounds like it was added as a standalone payment after it was taken out. Therefore, it would not appear on the agreement.

I'm not a financial expert but surely this is PPI despite the claim from Skycard that it isn't insurance?

Depends on whether an insurance company was underwriting it. Some of these things in the past didnt fall under insurance regulation. This doesnt look like insurance and doesnt look like PPI as its not paying out any benefit. It looks like a service where on specified events, you can get away without making any payments.

WombleSW20_2

Sky / Barclaycard will argue that is cover is not insurance (but rather a form of 'debt waiver' protection) and is in fact a feature of the credit card. You'll probably find that there's will be no insurer behind the cover as Barclaycard is effectively self insuring the claims themselves.

This is the first mis-sell complaint I've come across on this type of cover so it would be very interesting to hear what FOS has to say if you do take it to them - as this could become a test case as to whether it is insurance or not. Barclaycard will argue that this is a non-insurance product and therefore sits outside of FOS's jurisdiction.