Last call for PPI, says finance watchdog | Business


The City regulator is launching a final call for payment protection insurance compensation, as the total paid out to consumers passes £35bn.

With just over two months to go until the deadline for lodging a PPI claim the UK’s Financial Conduct Authority is launching a new advertising campaign to encourage more applications.

As well as bringing back the animatronic head of Arnold Schwarzenegger for the final time, the regulator has recruited 1990s TV fitness guru Mr Motivator and blogger Skint Dad to help promote its message.

The FCA said the total amount of compensation paid since January 2011 to people who were mis-sold the policies now stands at £35.3bn. In April 2019 alone, banks and other financial firms paid out £334m.

PPI is Britain’s costliest consumer scandal, with banks paying out billions of pounds to compensate people who purchased often worthless insurance cover, thinking it would help them repay debts in the event of sickness or unemployment.

As many as 64m PPI policies have been sold in the UK, mostly between 1990 and 2010. Banks and other financial institutions pushed the policies alongside loans, credit cards and other deals – but in many cases, exclusions meant customers could never make a claim.

The final deadline for complaining about the sale of PPI is 29 August 2019. Anyone who has not complained to their provider by that date will not be able to claim money back.

Banks have regularly increased the amount they have set aside to cover claims. Lloyds Banking Group has been landed with the biggest bill: to date, the scandal has cost it more than £19bn, with this set to rise further – the bank has said it expects to receive an average of 13,000 complaints a week up until the deadline.

In previous FCA adverts, the model head of Schwarzenegger, mounted on tracks, was seen pursuing shoppers and urging them to stop procrastinating and make a decision about whether to put in a complaint.

The regulator said that to emphasise how “pressing” the deadline was, it was launching a new series of adverts featuring the “Animatronic Arnie” head apparently being crushed in a hydraulic press.

The final deadline is aimed at drawing a line under the scandal in order to rebuild public trust in financial services and reduce uncertainty for banks and other firms worried about the open-ended nature of potential PPI liabilities.

Helped along by the advertising campaign, the final 10 weeks or so are expected to see a late flurry of activity as genuine claimants finally get around to submitting their complaints, while others try their luck.

The most effective way to make a PPI claim is to complain directly to the bank or financial firm concerned, and then to the Financial Ombudsman Service if necessary. Most claims firms charge a fee that can be up to 20% of any compensation paid.


Source link