£5.4 Billion – The Cost Of Compensating Victims Of Missold PPI policies

Statistics released by the FSA indicates that banks and financial institutions have paid compensation worth £5.5 billion to victims of mis-sold PPI policies over a span of 18 months ending in June 2012. Of course, not all claims have been settled and analysts expect this figure to rise to £10 billion before the issue will be fully settled. The intensity of the crisis can be understood from the fact that close to £615 million was paid to victims in the month of June 2012 alone.

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PPI Claims Are Becoming Very Popular

Filing PPI claims has become more common because people are interested in recovering money that they were forced to pay to lenders who mis-sold payment protection insurancepolicies.If one obtains the payment protection insurance policy, then it will help continue repayment even if there is a gap in the income of the individual due to unemployment or any other physical or mental disability. While PPI is useful, it has been exploited by lenders and the premium has been included in the overall liability of the borrower. This has resulted in an increase in payment without any significant benefits. Continue reading