Payment protection insurance is something that few people in the UK ever consider until it’s too late. The biggest problem with insurance is that you can’t purchase it after the fact.
Just like any other form of insurance coverage, PPI is there to protect you and your family in a case of an emergency. It helps to keep you on your feet during hard times, preventing financial ruin and unnecessary bankruptcy. You can learn more about PPI by visiting www.lowfeeppiclaims.co.uk
Once you find yourself in dire financial straits, it’s too late to take out payment protection insurance coverage on your debts. Many of those being potentially expensive, high-interest debts such as bank loans, mortgage agreements, credit cards, vehicle financing, and catalogue payments.
Honestly, a debtor might give you one or two months grace when you fall on hard times. However, they’ll rarely go past that, and most will demand full payment before your account goes 30 – 60 days past due in most cases. If you’re already struggling, being forced to make a full payment so soon after a health or financial catastrophe is like throwing a lit match on a puddle of petrol.
PPI Takes Care of the Unforeseen
Here are a few of the circumstances one might find themselves in, where you and your family would benefit from having PPI attached to your bank loans and credit cards:
- Contracting a sudden illness that forces you to stop working.
- Any sort of accident or act of nature that causes a financial strain.
- You become disabled.
- You’re fired or laid off from your job.
Also, most PPI policies include a life benefit that takes care of your balances in full if you die. This is one of the most common reasons why young couples and families of all ages take out PPI; so their spouse isn’t forced to pay off their joint debts, and so their extended families aren’t harassed by greedy debtors, including the often intimidating and nefarious doorstep collectors!
Reasons Not to Get PPI Coverage
As I’ve already alluded to, if you don’t get the coverage before taking on debt, you aren’t covered if/when you run into trouble making your monthly repayments. So, in effect, there is no good reason not to purchase PPI coverage…
… Unless you’re highly confident you’ll never be in an accident, never get ill for more than a few days at a time, or otherwise never find yourself in a position where you can’t make your monthly payments such as:
- You’re wealthy beyond measure.
- You’re self-employed (many insurers won’t cover self employed individuals).
- You have life insurance that covers all debts upon your death.
- You plan to take out a standalone ASU (Accident Sickness Unemployment) policy with your bank or a private insurer.
- You have a current critical injury policy.
- You’ve already purchased income protection insurance through your various debtors.
- Your employer offers sickness or redundancy benefits that cover your debts if your income drops below a certain threshold.
- Your mortgage provider offers or insists upon income protection coverage.
- You’re a freakish real life version of this man.
Common Hurdle for Consumers Taking Out PPI Coverage
Some of you will think you’ve got it all under control and nothing bad will ever happen to you – or to the family breadwinner – or your employer. However, most consumers don’t secure PPI benefits because they either can’t or refuse to pay the monthly premiums.
The fact is, PPI is a rather pricey add-on, especially if things are currently perfect in your life and you don’t like to spend your life fearing whatever devil may come in the future. There are also many PPI exclusions, some rather ambiguous, that scare consumers away from taking out this type of coverage.
Many debtors are now insisting that you take out a policy before they’ll give you a loan or any sort of credit. They’ll often try to pressure you into signing a policy they recommend, through an insurer they undoubtedly get referral benefits from. This is rarely the best option, as shopping around can offer big savings over the insurer the debtor recommends.
Are you mis-sold PPI?
The problem with ambiguous insurance policies is that you often take what you actually don’t need. This is a major issue of PPI.
If you’re not getting an adequate explanation on PPI exclusions, you might take the policy as if it’s a mandatory, not an option. If you’re in such situation, you may have been mis-sold PPI.
This is a big issue to many. Research reveals that more than two million PPI policy holders aren’t eligible to claim the PPI.
So, what’s your next step if you just realised that you’d been mis-sold PPI? You make a claim yourself, but we would suggest for you to hire someone who’s experienced in making PPI claims successfully.
If there’s any doubt whether you can maintain the monthly repayments on any debt you choose to take on, you’re a prime candidate for payment protection insurance coverage. Particularly on big debts like home mortgages, bank, and private lender loans, and high limit credit cards where you regularly carry a hefty balance at the end of the month.
Make sure to ask your lender whether the coverage is already included in your monthly obligations to them. If so, make clear on what your payments will be with and without the coverage, so you can get quotes from other insurers to compare rates.
Last, always make sure you know exactly what you’re paying for (ie., what debts and personal circumstances are covered by the insurance and which are not). Before signing anything, insurance companies in the UK are legally bound to make clear any exclusions that will prevent you from getting the help you need, when and if you ever so desperately need it.
If you happen to read this article after you realize that you’ve mis-sold PPI, then stay calm and don’t panic; what you should do next is by taking action promptly, as PPI claims must be made by June 2019.
Make a decision whether you should DIY or hire someone to make the claims for you, and make the claim as soon as you’re ready.