PPI on Lloyds TSB Loan

Sim1000

Hi all

I have had a loan with Lloyds TSB since Dec 2004, I signed up for the loan via my internet banking and knowingly agreed to payment protection insurance, I stupidly didnt look at the figures but have recently noticed the PPI represents around £1200 plus interest of the loan amount.

The PPI cover is relevant for me and should pay out if I ever needed it, however I do have generous sickness benefit from my employers.

I recently contacted LTSB and asked to cancel the PPI, however they stated that I could only cancel within the first 30 days and the only way I can get rid of it is to re-finance and arrange a new loan without PPI, this would be difficult due to my credit history.

I am not looking to reclaim PPI premiums for the full duration of the loan, I am mereley looking to cancel the cover and receive a refund for the period of cover not used.

I understand that the FSA have recently made some changes to the rules of PPI, does anyone know if this will help my situation as it is not clear from the FSA website.

Any help of advice would be appreciated.

wardlaw

HI

The FSA have indeed brought in new rules

You are entitled to a full refund

Ask the bank for one

If they refuse tell them you are entitled to a refund under FSA rules

John

jonesMUFCforever

Wardlaw could you please explain how OP is entitled to FULL refund when a) OP knowingly took out cover and b)this cover has been in place since inception of loan in 2004 and c) there is no evidence of mis-selling?

Surely a pro rata refund of what's left of the cover is the amount OP should be claiming?

kevster1009

ejones999 wrote: »

Wardlaw could you please explain how OP is entitled to FULL refund when a) OP knowingly took out cover and b)this cover has been in place since inception of loan in 2004 and c) there is no evidence of mis-selling?

Surely a pro rata refund of what's left of the cover is the amount OP should be claiming?

Your post may lose some credibilty when taking into account your employer!

towseriv

And why does anyone who works for LTSB have an interest in ither than passing on thier opinion? Not like we are the LTSB policy police is it?Besides whichj the terms and conditions of the loan agreement clearly state the first 30 days only. Besides which why should they get a full refund whwen they have not paid ou yet for the full cost? Besides which just because the OP has more than enough cover would this stop them making a claim if they were ill? No I think not.

jonesMUFCforever

kevster1009 wrote: »

Your post may lose some credibilty when taking into account your employer!

Your point is?

I note you did not answer any of my points , so do you agree with me?
My answer would have been the same regardless of which bank it was/is.

spurs_nut

If you wish to cancel you are entitled to a pro rota refund. This is if you have took out a single premium policy where it it added to the loan up front.

However, you will find it difficult to cancel the policy without refinancing the loan as it's part of the correct agreement.

Write a letter to head office stating that you wish to cancel the ppi as it is no longer valid due to you getting better benefits from your employer.

State that you wish to have the same level of apr as the original loan, and that if they disagree you will take to the fos as they are not allowed to make ppi a condition of acceptance of the loan or the loan rate.

use the below as a guide



Re: account 999999999999999999999





COMPLAINT



Dear Sir or Madam,



I took out the above loan for £x,000 on dd/mm/yy. When I took it out, I signed up for Payment Protection Insurance. I phoned up on dd/mm/yy to ask to cancel it and was told that this is impossible. I am writing to complain.



Put in any of the following which apply:



[When I took out the loan, I was told that I would not have been given the loan if I did not take PPI. I have since been told that this is not true, and that you are not allowed to make PPI a condition of taking out the loan unless you include the costs of PPI in your quoted loan interest rate, which you did not do. I therefore consider that I have been mis-sold this expensive insurance, which I do not need and which I said that I did not want.]



[I am self-employed/work as a contractor/unemployed and therefore will not be eligible for any payments from the PPI if I cannot get work or am sick. My situation was known to the person who sold me the loan, however he/she did not point out that the insurance was virtually useless to me so I think that I have been mis-sold the insurance.]



[When I took out the loan, I said I did not need the PPI as my employer provides generous illness and redundancy benefits, but I was told I should still take it out. As this is not correct, I consider that I have been mis-sold this expensive insurance, which I do not need and which I said that I did not want.]



[I wish to cancel the PPI because since taking out the loan, my employment situation has changed. I am now self-employed/work as a contractor/unemployed and therefore will not be eligible for any payments from the PPI if I cannot get work or am sick.]



[I wish to cancel the PPI because I now have sufficient alternative insurance cover from my employer and other sources.]



[I wish to cancel the PPI because I am in financial difficulties and cannot afford it. I enclose a Statement of Affairs which shows this.]



I have been advised that I should be able to cancel the PPI contract at any time and receive a partial refund of the premium that I have paid. I would like to do this. [And in view of the way I was mis-sold the insurance, I would like to ask for a full refund of the whole premium.]



I would appreciate a reply to this letter within fourteen days. If you reject this complaint, I would be grateful if you could explain whether you provide an internal appeals process. If you do not, please supply me with a final response letter, so that I can take up the matter with the Financial Ombudsman Service.



Yours faithfully,