Credit Card PPI mismanagement

NoLove4Lloyds

Hi,
Sorry if this scenario has already been posted but I didn't see anything in the PPI section? I'm not after PPI miss selling advice as much as mismanagement advice, I'll explain as follows:

In the '90's I was in full time work and was offered a credit card from the same lender I have a bank account with. The card included PPI.

My credit card and I had some great times together and I never gave the PPI a second thought.

In 2000 I then became a full time student, advised my bank of this, changed my account to a student account and also had my student loan paid into my account. I continued to use my credit card and it still included the PPI premium.

Although my credit card is no longer in use it did have a £15k limit that meant that some times when I was a student and the card was maxed out my PPI payments were, I think, over £100 per month.

So my problem is that a few years ago I found out that full time students (along with some other categories) are generally unlikely to be eligible to make a claim under PPI so all of the time I was a student I may have been paying PPI for no benefit.

I did write to the bank regarding this and pointed out that I when I signed up for the credit card I was unaware, nor made aware, that students would be unlikely to benefit from PPI. I also pointed out that in amending my bank account to a student account the bank and credit card would have been aware of the change in my status but took no action re reviewing my suitability for PPI.

It does now appear that the bank and credit card operations of a bank are run separately but my letter did also advise the bank that I could not reasonably have been expected to know this as both credit card and bank had the name of the same lender.

In their response, the bank wrote that they were satisfied that I was suitable for PPI at the time I took out the credit card and essentially said they had no duty, legal obligation (or interest?) in reviewing whether I continued to be suitable after the initial sign up.

As I mentioned, I'm not specifically claiming PPI miss selling. I might even go as far as to accept that at the point of sign up, as the bank asserts, the PPI would have been appropriate. However, as PPI payments were an ongoing monthly levy I think it is a little dismissive of any bank to keep taking PPI payments without making any review my ongoing PPI suitability after they were made aware becoming a student.

I appreciate banks can't be expected to review the products their customer are paying for (e.g. PPI) after every slight change they are advised of but I think that some changes such as mine, where I went from full time work to full time education, do represent both a significant change and one that is not uncommon. I know quite a few mature students who left work to go full time into education.

Sorry if this sounds like a rant. I am just curious to know how many other people might have also been paying PPI and then gone back to full time education or become self employed (I believe that's another one where PPI has little use) and if this has ever been raised as an issue before.

Thanks

-taff

NoLove4Lloyds wrote: »

In their response, the bank wrote that they were satisfied that I was suitable for PPI at the time I took out the credit card and essentially said they had no duty, legal obligation (or interest?) in reviewing whether I continued to be suitable after the initial sign up.

And they are absolutely right.

Its up to you to reveiw whether or not the PPI continues to be suitable, they are not there to check up on your life very year or so, only to sell you products.
As they've said it was suitable at the time, your next step is the Ombudsman because with that response they have interpreted your letter as a PPI misselling complaint.

NoLove4Lloyds

Thanks -taff. The first response I received from the bank was definitely as if they were replying to a miss selling claim. I did ask them to clarify my query re continuing to take PPI payments after I became a student and they said something along the lines of there has been no instructions (from the FSA?) to review such a scenario so we're happy their actions were correct.

If there's no new regulation or FSA guidance to advises banks to actively continue to ensure customers are still suitable for their products I don't think writing to the banking ombudsman would help but it was worth checking. Thanks for the advice.

-taff

|Look for other reasons why the PPI wasn't suitable, such as good sick benefits, being able to cover the payments another way etc.

http://www.moneysavingexpert.com/reclaim/ppi-credit-card-insurance

NoLove4Lloyds

Thanks again -taff, but my dispute re PPI on my credit cards really is just to do with the continued PPI charges after the bank were given enough info, re me becoming a student, to know PPI was no longer appropriate. If this is not regarded in the eyes of the regulator as bank wrongdoing I don think I'll itry a different line of argument.

Insider101

NoLove4Lloyds wrote: »

Thanks again -taff, but my dispute re PPI on my credit cards really is just to do with the continued PPI charges after the bank were given enough info, re me becoming a student, to know PPI was no longer appropriate. If this is not regarded in the eyes of the regulator as bank wrongdoing I don think I'll itry a different line of argument.

It's not. They are a bank, there to provide banking services, not a financial adviser.

If you were working under 16 hours per week while you were a student then you would probably no longer have been eligible for the cover. If I was you I would write back pointing out that you are not accusing them of misselling it but stating that you would not have been eligible after this point so asking if they would consider a partial refund as a gesture of goodwill. Don't be too aggressive about it though, like Taff said they are not in the wrong here so you are reliant on their goodwill.

[Deleted User]

Insider101 wrote: »

I stating that you would not have been eligible after this point so asking if they would consider a partial refund as a gesture of goodwill. Don't be too aggressive about it though, like Taff said they are not in the wrong here so you are reliant on their goodwill.

Yes, NoLove4Lloyds should be very careful not to mention "mismanagement" when requesting such a refund.