Is PPI void if debt recovery get involved

Arty_Fella

Hi all,
Heres one for you... i have 2 loans that i got back in 2004/2005 that i unfortunately missed payments on. Both loans ended up going to debt recovery agents and i have been paying them back with a reduced payment plan for a few years now.
I had insurance on both loans that covered me for redundancy and i was made redundant in 2008, but both loans had already been passed to the debt recovery people by that time. I just assumed the insurance was deemed void as soon as the credit recovery people got involved and i couldnt make a claim but i know assumption is the mother of all screw ups. Was i right in my thinking?
Cheers.

AMILLIONDOLLARS

I believe that you can still maike a claim, but any money that you win, will automatically go towards the outstanding balance of the loan. Go over to the PPI claim thread for more information.

AMD

InsideInsurance

The PPI claim thread is about claiming back your premiums where as the OP is actually wanting to make a claim on the PPI itself.

The fact it was sent to bad debt does not in itself invalidate the PPI insurance. The concern in your case will be if you actually had paid the PPI premium or not as inevitably failing to pay for your insurance could invalidate it.

You ultimately need to read your documents.

My ex used to handle PPI claims and they had two different policies - one where the total premium was added to the loan up front and subject to interest and the second where it was a monthly payment and no interest added.

On the second one, it purely came down to if the monthly insurance payments had been made, if they had a claim could be made, if they hadnt then payments had to be brought up to date first (for the PPI not the loan)

On the first one then a PPI claim could always be attempted because the PPI had been paid in full up front and the bank had simply added it to the loan.

In both cases, if a claim was successfully made whilst the loan itself was still in arrears then the arrears were ignored for the purposes of calculating the payments etc. So if for example your cover went beyond the end of the loan and medical evidence said you had no prospects of returning to work then they'd settle the remainder of the regular payments to the original end of the loan leaving you with the arrears, interest on the arrears and any penalty charges.

AMILLIONDOLLARS

I don't think the OP wants to make a claim 4 Years after being made redundant !!!! best he can do now is go for mis-selling.


AMD

InsideInsurance

The ex dealt with claims much older than that!

AMILLIONDOLLARS

InsideInsurance wrote: »

The ex dealt with claims much older than that!

Did they pay out?? The reason I ask, is that the OP would have had to have kept all his supporting documentation about his redundancy and records about his job seeking efforts etc.. to cover the period.

AMD

InsideInsurance

Same as ever, in some cases they paid out and in others they didnt. It naturally depended on both the validity of the claim and the supporting evidence they could provide.

StuC75

Wouldnt this be more a case of 'Is PPI Valid if the payments (premiums) havent been paid?' - OP originally stated that the payments were missed and Debt Recovery involved before was made redundant..