PPI Refund Ripoff

SuzySu

Hi

The PPI on my loan is for £11,227.50 which was sent to the insurers at the start of the loan (single premium).

If I cancel my PPI (14 months into a 25 year loan), they say they will only refund 13% of the PPI - just £1,450.

Is this legal? Can't they claim the remainder back from the insurers? I was going to call them today to cancel the PPI, but I feel I need some advice first.

I really don't want to settle the outstanding amount (£56,500) and then try to claim the PPI back.

Any ideas please?

standupguy

Firstly I am assuming you have not made a claim on the policy?

The FSA seem to be advising companies that a refund does not have to be pro-rata but that the refund should be fair after taking into account any related costs.

In this instance it does look like the refund is totally unfair and this may be their opening gambit to see if you will accept it.

If I were you I would call them – best to speak to the Compliance Manager if there is one ( or alternatively go for broke and ask to speak directly to the CEO Neville Allport ( you may not get to speak to him but they will at least put you on to someone high up in the organisation), and say: -

• That you wish to make a formal complaint regarding the amount of the PPI refund and you are prepared to take this complaint to the Financial Ombudsman Service if the complaint is not dealt with satisfactorily
• You are aware that the group is authorised and regulated by the FSA and that the refund offered is considered to be in breach of FSA requirements
• After you have outlined your complaint, ask them to confirm that they are dealing with this under the complaint regulations required by the FSA
• Make sure you get the full name(s) and job titles of those that you speak to.
• Tell them that you are “not being treated fairly and this is one of the basic principles of FSA regulation”
• You are aware and understand the refund should take into account their reasonably incurred costs but the quote given is far in excess of this
• Inform them that you are aware that the FSA is monitoring how firms deal with this type of complaint and that the FSA have stated they will take steps to ensure that PPI customers are treated fairly
• Ask them to acknowledge your complaint in writing within 5 days if they cannot satisfy the complaint within 24 hours (they have to do this – these are the rules)

I would expect them to come back with a revised offer within 24 hours.

Once they do it may be a good idea to ask them how they have calculated this revised refund - they may mention admin fees, uneven spread of risk across the length of the policy etc, etc

Get a breakdown of the name and amount of each cost that they have deducted from your refund

If they do not play ball then you should have a letter acknowledging your complaint within 5 days and a decision within 4 weeks – if they do not do this then again they are in breach of FSA regulations.

If their final decision is not satisfactory then you can then take the complaint to the Financial Ombudsman Service ( at no cost to you )

SuzySu

Wow thanks so much. Right.......here goes. Will update you later.

SuzySu

Just spoken to them. They would not put me through to any department at all - I have to "follow the correct complaints procedure". Fair enough I suppose. However, I'm not sure whether I should be complaining about a mis-sold policy or simply about the amount of rebate we should receive.

They are sending me the form to apply for my SAR and until I read the transcripts I don't really know whether it was mis-sold. It seems a bit of a grey area.

At the time of taking out the loan I just remember being so relieved that we were going to get ourselves out of our financial nightmare that I can't really recall whether we were informed about things like 'it will only cover you for 5 years' or that it would be a lump sum payment upfront.

All they kept saying was "well we did send you the paperwork and it clearly states that.....". My response was "just because you have it in your brochure, it does not neccessarily mean that it is fair".

What should my next step be?

standupguy

What a shower these people are?

They have now breached the FSA complaints procedure by not accepting your verbal complaint - do they not realise they can get fined thousands of pounds?

I would do a couple of things.

Firstly, due to their not accepting a verbal complaint you have a right to go straight to the Finacial Ombudsman Service.

I would ring FOS on their compliants line and tell them that the company refuses to treat this matter as a complaint - tel 0845 080 1800.

I suspect they will take the details and get in touch with the company on your behalf.

Secondly, unless they advise otherwise, as you have time constraints, I would write a letter to Picture detailing your complaint and all of the phrases that I mentioned earlier - best to send registered post?

You will get there in the end - of that I have no doubt!

SuzySu

Thanks again. Although the would not put me through to the complaints department "because they don't take incoming calls" yeah.....right..... he did say he would pass my complaint on to the right department, although he doesn't really know whether I cam complaining about mis-selling or the crappy rebate figure so how can they respond?

I have demanded an acknowledgment letter from them within 5 working days as advised by you.

Is it still worth ringing the FOS at this stage, or should I wait and see what I get from Picture. I don't want to go in all guns blazing yet.....

standupguy

It's your call.

Ringing the FOS is no cost to you and under the circumstances they can move it on a lot quicker with Picture as the firm will sit up and take notice.

From what you say they do not appear to have followed the correct complaints procedure as what they have said sounds makeshift rather than a proper acknowledgment of a verbal complaint.

With FOS on their tail it would focus them to sort it out quickly.

It does you no harm to speak to FOS and see what they advise - it's a cheap rate phone call?

You need to be clear though what it is that you want - a full refund as you were mis-sold or a fair rebate for cancelling the PPI.

It may be easier to set the ball rolling first on the fair rebate complaint - it does not stop you going back if the transcriptions provide evidence of mis-selling?

SuzySu

I am deeply grateful for all your time and would like to thank you so much. I think I will call the FOS - as you say, I can look at the transcripts and then decide, but I feel I have more of a chance of upping the rebate - we shall see.

Will update later.

standupguy

The effort you are putting in will be worth it in the end and, hopefully, an inspiration to others to not accept bad service and fobbing off