Help needed to take ppi complaint to FSO

ewanirvine

I have received a rejection for my late mother's PPI claim and told to go to FSO. They have listed various reasons and I was wondering if someone could advise and give some guidance to me. If there was an expert that could help ?

[Deleted User]

You just give FOS your reasons for disagreeing with the decision.

These reasons will be based on your specific mis selling complaint.

ewanirvine

cheers,,,that is the problem ..I am not too sure how to go back disagreeing with the points that the company is making so I was hoping someone could take a wee look and help

[Deleted User]

What was your complaint reason and what was their reason for rejections?

If it's something black and white - eg you said she wasn't covered and they evidenced that she was, then there's not much point in escalating it.

ewanirvine

This is the wording that came back. I have taken out personal details including name of company and will set out my own thoughts in next post 
   

As already confirmed to you during our telephone discussion, xxxxx had other Loans between July 1991 and March 1996 and we have no evidence to show PPI were arranged on them. The review below relates to the last Loan taken out in June 1998.

 Your concerns

 

As I understand it you believe the policy may have been mis-sold and have asked us to check if this was the case.  As part of our review, we have also considered whether late xxxxx policy falls under the FCA’s rules and guidance in relation to non-disclosure of commission.

 

Our findings

 

We’ve carried out a full review of the complaint and the sale documentation confirms:

 

1.       She was aware of the PPI

2.       Eligibility to have the policy was checked and met

3.       Sufficient information was provided, at the time, to allow an informed decision to be made.

 

Additionally, there is no evidence to suggest a successful claim could not have been made if needed.

 

Documents reviewed include: 

 

·         Loan Agreement

·         Policy Document

·         Welcome Booklet

 

At the time of the sale xxxx was employed by xxxx and had been for 7 years.

 

You confirmed xxxx would’ve received Statutory Sick Pay (SSP) if unable to work. SSP only provides for a minimum standard of living and it's questionable whether all financial commitments could've been met on SSP.

 

If unable to work you confirmed savings could've been used to make the repayments. However, the PPI removed the need to rely on savings, which can be an unreliable source of funds over the long-term. Circumstances can change and there's no guarantee these would've been available when needed.

 

You indicated that she was in receipt of a Widows’ Pension which she could've relied upon to make the repayments. The sole reliance on the pension income would've resulted in a reduction in her total income, affecting her ability to meet any financial commitments.

 

As xxxx was responsible for the repayments it's understandable she would consider taking out the PPI policy. Given the financial implications of being unable to work and responsible for the repayments, the decision to take the policy was a prudent one.

 

You have confirmed that xxxxx did not have any health problems at the time of the sale. As the policy was sold on a non-advised basis we weren't required to confirm details of her personal circumstances or assess the suitability of the policy. The only requirement was to provide information.

 

The Unsecured Personal Loan Agreement xxxx signed shows that 'Optional Credit Insurance' was added to the Loan.

 

The Loan Agreement showed the:

 

• amount of the Loan

• interest payable

• total amount payable over the whole term

• monthly payments

 

The figures for Loan Agreement and the 'Optional Credit Insurance' were added together, confirming the insurance was a single premium policy.

 

There were no conditions in the Loan Agreement which implied or stated declining the PPI would have a negative effect on the Loan application or its approval. You could see xxx had cover as this was indicated by an asterisk (*), confirming she was insured for “disability, unemployment and life”. It's reasonable to suggest you read the Loan Agreement before signing it and therefore would've been aware of the insurance.

 

Once we received the signed Loan Agreement, the Loan was set up and a Welcome Booklet was issued providing information about the policy. We also sent a copy of the Policy Document which detailed the benefits, exclusions and Cancellation Rights of the PPI.

 

A successful accident or sickness claim under the policy could’ve paid out for the remaining term of the Loan, or until xxxxx returned to work, whichever occurred first. The policy also protected against unemployment for a maximum period of 12 months, in any one claim period, and in the event of death would’ve repaid the Loan, subject to the Terms and Conditions. The policy would also have paid out regardless of any other means available.

 

xxx was under no obligation to take out the PPI as this cover wasn't compulsory and didn't form part of our Loan Terms and Conditions.

 

Our decision

 

For the reasons explained above, I can’t agree the policy was mis-sold or that it falls into the criteria for non-disclosure of commission, therefore no redress is due.  I realise this may be disappointing, and I hope you can understand the reasons for this decision. 

ewanirvine

I am not sure what exactly my mother would have known about PPI at the time, but I rather suspect that she would not known have anything.   She took the loan for a home improvement, and interestingly when I was on the phone to them, they simply cannot locate whether there was ppi on the previous loans or not. I asked them to look for paperwork but they seemingly are unable too.   My mother did not take out ppi on anything else she had, credit cards etc.  She had a part time job that was really to get her out of the house and there was no mortgage. My mother had a widows pension etc and really did not need any part time job.  She had savings which I am sure were accessible but was one of those folk that liked to save and had there been any difficulty in loan repayments , which really was never going to happen, she would have used savings. I just don't feel, my mother would have taken out ppi, as she did not with anything else,

-taff

No one can magic up records that aren't there any longer and these loans are from over twenty years ago. Guidance says to delete after 6 or when there is no need for them anymore. Clearly there was no need for them anymore and htey have deleted them.

Your only hope with the FOS is to use single premium [google it] to complain. Your other complaint reasons are not good enough and they have relied on you saying she didn't know about it, which you can't prove, and she didn't need it, which they have disproved.

ewanirvine

cheers,,how do you argue the single premium ?   I have looked at it, but not quite sure how it applies 

[Deleted User]

ewanirvine said:

cheers,,how do you argue the single premium ?   I have looked at it, but not quite sure how it applies 

If the PPI was front-loaded onto the amount borrowed  so that it formed  part of the loan and so attracted extra interest,  then this is single premium. 

If your Mother made a separate repayment of the PPI then she had  no single premium. If she made a single  repayment each month   then she did. There really is no "argument" to be made and any complaint on such a basis would simply  be a factual statement of mis-selling.

You'd need to check the initial  Agreement paperwork.

However, while some years back such front-loading was a surefire complaint success,   nowadays it's not so cut-and-dried unless the loan was part of a consolidation chain of loans (which this does not appear to be). 

Certainly, you won't get anywhere by simply taking  your SSP and Widow's Pension argument to the Ombudsman I'm afraid. That and any savings she had (which you'd have to evidence, of course) are not an indication that she had no need of the insurance. 

In addition, you are not in a position to categorically state your Mother did not know about the PPI.  The Bank, on the other hand,  can point to the Agreement she signed indicating that she did know. 

dunstonh

There doesn't actually appear to be a response to complaint reason in their reply.   More a case of covering al the bases.  What exactly were the complaint reasons?

I am not sure what exactly my mother would have known about PPI at the time, but I rather suspect that she would not known have anything.

In most cases, that would not be sufficient for a successful complaint because you cannot prove that.  They have the consumer credit act agreement showing the premium listed in the agreement. They have an application.    So, in this scenario, the evidence points towards her knowing.

Thrugelmir

ewanirvine said:

 She had savings which I am sure were accessible but was one of those folk that liked to save and had there been any difficulty in loan repayments , which really was never going to happen, she would have used savings. I just don't feel, my mother would have taken out ppi, as she did not with anything else,

Subjective opinion carries little weight. As in reality you don't know what your mother was thinking at the time nor the reason behind her decision.
What information do you have regarding her savings at the time?