Black Horse, Single Premium PPI on secured loan

gps2000

Hello, sorry for starting a new thread, my mum’s scenario is quite complicated and wanted some advice on it so I know how to proceed. If there is a more appropriate place for this, I can move the post there.

I am trying to help my mum with her PPI on a Black Horse Secured loan against her house she took out in 2007. The loan was to consolidate several loans and credit cards and she could not afford her monthly outgoings.
The loan was sold with a single premium PPI for ~£11k with has interest at the same rate as the loan with interest accrued on the loan over the same period of ~£6k. It is a ten year agreement and she is 4 years into it.

Having found out about the possibility of recaliming miss-sold PPI - I have asked her various questions about how she was sold the PPI, and she was sold the PPI at the time of taking out the loan in-branch at Black horse. Looking at Martin’s PPI checklist and elsewhere on grounds for reclaiming, she said that the true cost of the PPI was never explained to her or that there were alternative options available on the market or that she could even search for cheaper PPI. She also said that she was encouraged to take out the PPI based on her situation as she was a single mother (my dad had died a couple of years before, which lead to a debt spiral of ending at a point where she was required to get a secured loan). She does not remember being asked about prior medical conditions or if she had any other cover which would mean the PPI insurance was not necessary.

Is there a case for a PPI reclaim on miss- selling?

Also my mum fell ill in 2009 and was unable to work so had a successful PPI claim where the insurance paid the loan for 12 months 2009-2010. Reading the articles on the website Martin has indicated that she can still claim if there is a case but not sure of what chances of a successful claim under this scenario.

I have at least on reading the articles advised my mum to cancel the PPI insurance and take out a cheaper PPI insurance.

However when she discussed the possibility with Black horse they indicated that while the PPI can be cancelled our monthly repayments would slightly increase and not decrease (currently the loan and PPI loan are paid in one monthly payment) (and therefore we would essentially be repaying for the PPI loan + Interest) and so it is not really cancelling the policy. They indicated that as we had, had a successful claim we would now have to pay the full cost of the insurance over the course of the 10 year agreement. She has not indicated to Black horse that she is considering launching a PPI reclaim complaint.

Can anyone advise on whether they are allowed to do this in regard to us requesting that the single premium PPI be cancelled?

Having reviewed the terms and conditions, it does not indicate that on a successful claim on the insurance that you would then be tied in for the remaining period. It does indicate that there is an option to cancel and that if there hasn’t been a claim some of the premium can be refunded.
Thank you for any advice. I would really like to help my mum either in a PPI reclaim or cancelling the current PPI and want to know where she stands in this situation.

Additionally she has had two other loans with Black horse over the years, which she believes had PPI on them. Can she complain against one and all 3 would be reviewed or would all 3 have to have separate complaints against them?

dunstonh

or that there were alternative options available on the market or that she could even search for cheaper PPI.

That is not a valid complaint reason. Providers and tied agents of the lender or insurers are not required to say tell you that you can get it elsewhere of it any alternative is better. This one is an internet myth.

Is there a case for a PPI reclaim on miss- selling?

I would go with the most obvious thing of the lot. Single premium and added to debt and charged interest. That is the one area where most PPI complaints get upheld. The rest is either irrelevant or unprovable. Single premium is by far the easiest as it is provable.

Also my mum fell ill in 2009 and was unable to work so had a successful PPI claim where the insurance paid the loan for 12 months 2009-2010. Reading the articles on the website Martin has indicated that she can still claim if there is a case but not sure of what chances of a successful claim under this scenario.

It invalidates a lot of the complaint reasons (you cant say it wasnt needed and you cant say you didnt know it was there). A successful complaint (which is likely) would see the amount of the refund of the premium paid reduced by the amount of the claim paid out when she was ill.

Having reviewed the terms and conditions, it does not indicate that on a successful claim on the insurance that you would then be tied in for the remaining period.

Whilst that is normal for fixed term insurance (its the same on car and household for example) the fact is that fixed term insurance should not have been added at the start. So, that invalidates their response.

Additionally she has had two other loans with Black horse over the years, which she believes had PPI on them. Can she complain against one and all 3 would be reviewed or would all 3 have to have separate complaints against them?

She can complain about them all in one complaint letter.

gps2000

Thank you for the response dunstonh.

I didn't realise simply being sold a single premium PPI policy was grounds for a PPI miss-selling complaint. It isn't included in Martins articles from what I read. I understand the single premium PPI was essentially banned in 2009 but didn't realise therefore this was clear grounds for a PPI reclaim complaint.

If I am to complain on this basis is there a standard wording I could use? So essentially I am compalining that my mum "was sold a single premium PPI that was added to debt and had interest charged on top of it which was unfair and subsequently banned in 2009." and therefore entitled to have the PPI reclaimed.

Additionally as I will now start sorting out my mums complaint (thanks for your advise) would you suggest continuing to push for a cancellation of the PPI? or wait for the outcome from the complaint? As per martins articles this complaint will most likely lead to the cancellation of the policy anyway?

dunstonh

I didn't realise simply being sold a single premium PPI policy was grounds for a PPI miss-selling complaint. It isn't included in Martins articles from what I read.

Thats a shame because it is the reason why most loan PPI complaints get upheld.

If I am to complain on this basis is there a standard wording I could use?

Not really. You just need to state that it was single premium, added to debt and charged interest on it and you believe that to be wrong. Even if they reject it, the FOS are upholding around 99% of Black horse ones so you should be confident.

Dont mention it being banned in 2009.

Additionally as I will now start sorting out my mums complaint (thanks for your advise) would you suggest continuing to push for a cancellation of the PPI?

Yes. if you dont ask you dont get and the people handling the complaints can often arrange and sort things that the call centre staff cannot do.

As per martins articles this complaint will most likely lead to the cancellation of the policy anyway?

That is correct. However, it is best not to assume. State that it is to be cancelled going forward. Dont leave any doubt.

gps2000

As an update on this claim.

My mum sent a complaint to Blackhorse which was rejected.
We sent the claim to the financial ombudsman.
Several months later the Financial ombudsman, got in contact and inidcated that Blackhorse would now be making us an offer based on the Financial Ombudsman getting involved.

She accepted the offer.
Her account with Blackhorse has been reconstructed to remove the initial PPI single premium loan added to it and interest to date.

Blackhorse paid out the difference between what had been paid by my mum on the PPI and what they had paid out when my mum was ill in 2009/2010. This difference is what they applied the 8% simple interest to.

A small amount was added to the offer for distress and delay.

I would like to say thanks for the advice and information available on moneysavingexpert and posters on the forums.