Claiming for costs for failed claims

scubaturtle

I purchased PPI called Total Mortgage Protection Plan from the Halifax several years ago believing that it would cover my mortage costs should anything happen to my income (illness, redundancy..etc).

4 years later (never having missed a premium) I was diagnosed with acute depression and had to leave work. I made a claim on the insurance that was rejected initially but later I was told I was eliglble. However, I hadn't been able to pay the last two months premiums as I had been out of work so they cancelled the policy on that basis and so I had no income at all and very soon sfter that spiralled into a lot of debt.

My question is can I claim for costs associated with being missold PPI - ie. I needed to re-mortgage my house (to stop it getting repossed) because I could no longer afford the repayments, because I was falsely sold a policy that told me I would be covered if I became to ill to work.

Can I claim for these other associated costs (I am now severly in debt all because of the PPI failing to pay out) in some other way - if the PPI was deemed to have been misold?

Thanks for your help!

magpiecottage

Possibly - you would need to include this in your complaint, though.

dunstonh

My question is can I claim for costs associated with being missold PPI

doesnt sound like it was mis-sold. It sounds more like they mis-handled your complaint.

magpiecottage

dunstonh wrote: »

doesnt sound like it was mis-sold. It sounds more like they mis-handled your complaint.

I agree - that should not stop it being upheld, though.

scubaturtle

I actually (today - hoorah!) got a letter from the bank with an offer of repayment totalling £4000 (including interest). In reality, because they didn't pay the insurance claim it cost me many thousands more, I went into arrears on my mortgage totalling almost £20,000 and then had to re-mortgage with a sub-prime lender to release the equity in my property so I could pay off the arrears and have some money to live off whilst I underwent therapy.

I've been working now for the past 3 years, but I practically lost everything I owned because of this one mis-handled claim.

I did put all this down in the claim form I sent to the Halifax, but they make no mention of it in their response. Their offer clearly states "refunded premiums plus simple interest".

Now they've admitted the PPI was missold, ie. I thought I would have total mortgage protection but this was not the case, can I make a further claim for losses occured? Do I need to accept this offer and actually file a separate claim or do I need to reject this offer and re-explain why? I lost more than they would ever pay out. I wouldn't even know what figure to put down, re-mortgaging to the Subprime lender has me paying £1689 a month for an interest only mortgage as opposed to £1270 a month for a capital and interest mortgage. Ie. I'm still feeling the aftermath of them not processing my claim and will continue to do so for many many years.

roonaldo

scubaturtle wrote: »

Now they've admitted the PPI was missold, ie. I thought I would have total mortgage protection but this was not the case, can I make a further claim for losses occured? Do I need to accept this offer and actually file a separate claim or do I need to reject this offer and re-explain why? I lost more than they would ever pay out. I wouldn't even know what figure to put down, re-mortgaging to the Subprime lender has me paying £1689 a month for an interest only mortgage as opposed to £1270 a month for a capital and interest mortgage. Ie. I'm still feeling the aftermath of them not processing my claim and will continue to do so for many many years.

The thing is Halifax most likely upheld your complaint as they are auto upholding all complaints at the moment without a review. Most PPI policies wont ever pay out for depression, so its unlikely it ever would have paid out, so I would say No. But im sure someone will add some more.

From what you have said nothing suggests it was mis-sold, its just that a claim didnt pay out, which is a seperate issue.

src007

scubaturtle wrote: »

I actually (today - hoorah!) got a letter from the bank with an offer of repayment totalling £4000 (including interest). In reality, because they didn't pay the insurance claim it cost me many thousands more, I went into arrears on my mortgage totalling almost £20,000 and then had to re-mortgage with a sub-prime lender to release the equity in my property so I could pay off the arrears and have some money to live off whilst I underwent therapy.

I've been working now for the past 3 years, but I practically lost everything I owned because of this one mis-handled claim. .

Personally I think its disgraceful that many PPI policies had a blanket ban for mental illnesses. I can understand that maybe a high level of proof is needed to stop spurious claims however treating depression (or other conditions) as if they're some kind of laziness and excluding them from the policies altogether surely shows some deep prejudices in those that designed the polcies.

If you look at it, really there are two complaints:

a) being mis-sold the policy at the time of the sale;

b) being unfairly turned down for a claim when you tried to use the insurance.

I think that you could argue that there are consequential losses that flowed as a direct result of b) being unfairly turned down for a claim but not from a).

You have three options:

1) Accept the offer - thats all your really going to get for a MIS-SOLD policy, had it not been sold to you in the first place, you wouldn't have been able to use the insurance anyway.

2) Get legal advice; or

3) Write back to Halifax arguing you have suffered consequential losses as a result of being unfairly turned down for a claim on the PPI policy. You would effectively be starting the complaint again about what happened when you were turned down (rather than when you were first sold the insurance at the start of the mortgage).

The Financial Ombudsman Service certainly have the power (in theory) to award consequential losses if you can prove they were the direct result of being rejected for a claim. Although saying this, they would usually just ask for the claim to be honoured (e.g. ask for the mortgage payments to be covered for the period you were out of work). Arguing for the additional losses as well, maybe quite a tough ask.

The trouble is there is alot of uncertaintly with 2) + 3) so the safest option would be to accept the offer as you may end up with nothing with the other options. I hope this makes sense.

(p.s. whilst posters on MSE like to help people think things through, don't rely on an advice you get from an internet forum as people can say anthing!).