Some lenders, Lloyds Banking Group included, have been fined by regulators for the poor handling of claims - customers’ claims being unfairly rejected and/or having to wait for lengthy periods before receiving a decision.
The result is that Lloyds has had to pay out many millions of pounds to customers who were mis-sold policies and each year they are having to set aside funds to meet future claims.
This guide covers:
- What Is Payment Protection Insurance?
- How Was PPI Mis-Sold By Lloyds?
- Could I Have Been Mis-Sold PPI By Lloyds?
- What Provisions Has Lloyds Banking Group Made For Mis-Sold PPI?
- How Has The PPI Scandal Hit Lloyds Banking Group?
- What Brands Do Lloyds Banking Group Own?
- How Long Do I Have To Make A PPI Claim With Lloyds?
- What Financial Products Did Lloyds Sell PPI With?
- How Can I Make A Claim Against Lloyds Banking Group?
- Have Lloyds Rejected Your PPI Claim?
- The Financial Services Ombudsman – What Do They Do?
- Are There Benefits For Using A Claims Management Company?
- How Do I Start My Lloyds PPI Claim?
- Plevin High Commission Claims With Lloyds
- Help to Calculate Your Lloyds PPI Refund
What is Payment Protection Insurance?
PPI isn’t as difficult to understand as some would have you believe. It was an optional add-on insurance policy to cover the repayments on financial products such as mortgages, loans and credit cards.
The purpose was to cover policy holders who could not work and therefore meet their monthly repayments for any of the above products due to sickness, long term injury or redundancy.
How Was PPI Mis-sold by Lloyds?
There were several underhand sales tactics used to mis-sell PPI policies once lenders such as Lloyds discovered just how profitable they were. Sales advisers were encouraged to sell PPI policies and in return they would receive a commission on the sale.
- Unaware – there are many cases of customers not knowing that the PPI had been added to their product. They were not only repaying their loan, but they were also paying for an insurance policy they did not know about.
- No option – it was a widespread practice for sales advisers not to tell customers that PPI was optional, that they could either opt out of having it or they could buy cover elsewhere. Some were told that the loan would not be approved if they didn’t take out the PPI.
- Couldn’t ever claim – sales advisers had sold policies to people who would not have been covered by it, so they wouldn’t be able to claim on the policy if their employment status changed.
- Underhanded – some sales advisers used methods to sell policies that were ethically and morally wrong. For example, telling customers of what could go wrong if they didn’t take out the policy.
- Pre-existing conditions – most PPI policies will not cover those with pre-existing medical conditions and the sales staff didn’t find out if the customer had any, or if they had cover elsewhere.
- Commission – the sales adviser didn’t tell you that part of the cost of the premium went to the lender, bank or broker as commission.
- Pressure sales – the sales adviser put pressure on you, the customer, to take out PPI.
Could I have been mis-sold PPI by Lloyds?
Many thousands of policies have been mis-sold. You may be able to make a claim for the recovery of the premiums you paid plus the interest charged on the premiums. In addition, there will be a compensatory interest rate of 8% per year.
What provisions has Lloyds Banking Group made for mis-sold PPI?
There has never been a bigger or more expensive scandal in the history of financial services in the UK than mis-sold PPI.
This scandal has resulted in UK banks having to put aside billions of pounds to compensate customers who were mis-sold payment protection insurance policies. The total cost to the banks so far has been over £44bn. Banks and lenders made extra provisions after the FCA announced the deadline for all PPI claims to be made by August 2019.
How has the PPI scandal hit Lloyds Banking Group?Lloyds Banking Group has set aside a total of £18.8bn for PPI compensation so far.
FCA Fines imposed on Lloyds for Mis-sold PPIAs of July 2017, Lloyds Banking Group has set aside a total of £18.1bn to meet PPI compensation claims. So far, the group has been fined:
- £4.5 million in Feb 2013 for delaying compensation payments to its customers
- £117 million in June 2015 for the way it handled complaints about payment protection insurance
What brands do Lloyds Banking Group own?
Originating in Birmingham in the 1700s, the bank expanded over time and went from strength to strength by acquiring smaller banks and in the early 1900s took their operations overseas.
Lloyds Banking Group are one of the biggest banks and providers of finance in the UK and own the following brands:
- Lloyds Bank
- Bank of Scotland
- Scottish Widows
- Black Horse
- Lex Autolease
- Birmingham Midshires
The Most Common Products Lloyds Sold PPI With
If you have ever taken out any of the following financial products, there is a risk that you were sold PPI and it may have been mis-sold.
Other products Lloyds sold PPI with:
- Dealership car finance with PPI
- Store cards with PPI
- Catalogue credit with PPI
- Monthly-paid insurance with PPI
- Overdraft with PPI
The easiest thing to do is ask the bank or lender concerned if they sold you PPI or use PPIClaims.com to get a free PPI check done.
How long do I have to make a PPI claim with Lloyds?
The Financial Conduct Authority (FAC) announced a deadline for people to claim compensation for mis-sold PPI. All claims must be made by 29 August 2019.
There have been millions of people who have already made successful claims against banks and lenders however, there are many more still to claim. If claims are not made before the deadline, it will be too late.
What is 'Plevin' rule and how did it come about?
The name Plevin has been mentioned in the media yet many people do not know what if refers to or understand it’s relevance to PPI.
Plevin has had an enormous impact on how PPI complaints are handled and their outcomes.
It all started with a court case involving a lady called Susan Plevin, a retired college lecturer, who took a loan company to court when she discovered PPI had been added to her loan.
The case initially centred around the fact the PPI didn’t meet her needs. However, it was only after she made her complaint that she discovered the high level of commission that was being paid to the brokers from her premium - 71.8%.
Plevin went back to court to argue that had she know how much commission was involved she would never had taken out the agreement and that this led to an unfair relationship contractually.
In June 2014 the Supreme Court ruled that Plevin had been mis-sold PPI and that the relationship was unfair under the Consumer Credit Act 1974.
Plevin High Commission Claims With Lloyds
Lloyds may have earned a high level of commission from your PPI, which you knew nothing about, so you may be eligible to make a claim under the Plevin rule.
However, this is not possible if you have already had your PPI claim refunded. This is because Plevin ruling does not apply to settled PPI claims.
So, If your PPI claim was rejected you are able to complain about the commission if:
- You took out the finance the PPI was sold with on or after April 2007; or
- The finance with the PPI was sold before 6 April 2007 and was still in place on or after 6 April 2008.
However, another recent case, Doran v Paragon Personal Finance June 2018, decided by a District Judge in a County Court. He awarded the claimants all their high commission payments back plus interest.
The case of Doran does not set a precedent, like Plevin case does, as it was decided in a lower court and may yet be appealed by Paragon Personal Finance.
Customers who have already been successful in their claims for mis-selling cannot claim under the Plevin rules. This will still apply after the recent Doran case. Lenders will only consider claims for undisclosed commission if the customer has been rejected for a mis-sale.
If you feel that you have paid high commission for a PPI policy, you may be entitled to compensation, please complete our online PPI High Commission Check Form.
Claim Next of Kin PPI
An area of mis-sold PPI that is often overlooked because many people do not know about it is claiming on behalf of a deceased spouse or other family member. For example, if you knew your spouse was paying for PPI before they passed away and you have concerns if it was mis-sold, you should find out as you may be entitled to claim it back.
Each month a sum of money was paid for a PPI policy that covered the policyholder should they repayments become unaffordable because of illness, accident, redundancy or death.
The PPI policy would have been sold by a bank, building society or other financial provider such as an insurance company or broker.
There have been many cases of banks, lenders and other providers selling PPI to customers who would never be able to claim on it.
The are several situations that could apply to your spouse or family member that would make them ineligible for PPI. These include:
- Having a pre-existing medical condition or if someone was;
- Being self-employed or retired at the time of taking out the cover;
- Public sector workers, civil service workers and those in other similar employment may have protection through their employment contracts, so did not require PPI;
- Some customers were not aware that they had PPI as it was added on with their consent or knowledge;
- Customers being led to believe the PPI cover was compulsory when it was optional, indicating that they didn't understand what the cover was for.
If you, as an executor, personal representative, or next of kin know or suspect that any of the above situations applied to your late spouse or family member, look further into it as there is a strong possibility that the PPI was mis-sold.
Here's what you need to do:
- Establish if your spouse or family member was paying for PPI on a credit card, loan or mortgage.
- Try and work out if the PPI was mis-sold based on the situations described above.
- Decide how you want to pursue the claim: yourself or by using PPIClaims.co.uk. By using PPIClaims.co.uk we do all the hard work, so you don't have to.
If you think there may be PPI on any loans or credit agreements that were take out by a deceased spouse or family memeber it is worth getting a FREE PPI check done to know for sure.
How can I make a claim against Lloyds Banking Group?
If you think you have a claim against Lloyds Banking Group for the mis-selling, you will need to provide as much information about the policy you had. The following information will help Lloyds Banking Group to process your claim:
- PPI account policy numbers
- The dates of when you took the policy out and how long you had it
- How the policy was sold to you
- Your employment status when the policy was sold
- If you had any savings or other insurances in place at the time of taking out the policy
- The reason for taking out the finance and how much you paid off
Have Lloyds rejected your PPI claim?
After sending all your information and evidence you receive a letter from Lloyds to say that your claim has been rejected. What do you do now?
If you strongly feel that you were mis-sold and the information you have substantiates the claim, you can ask the Financial Ombudsman Service to take the matter up.
Even if you don’t have sufficient paperwork and depending on how long ago the policy was taken out you may still be able to get your refund.
The Financial Services Ombudsman – what do they do?
If you feel that your claim has been unfairly rejected by the bank, that doesn’t have to be the end of the matter. You can escalate the matter by getting in touch with the Financial Ombudsman Service (FOS), however this can only happen eight weeks after making your first complaint to the bank and receiving the rejection letter.
The FOS is an independent body set up by the government that is tasked with settling disputes between the PPI policyholder and financial organisation concerned. Their decision if final and binding on the on the organisation.
To determine if you were mis-sold the policy or not, the FOS will ask you to fill out an online questionnaire.
The banks’ decision will be received by an adjudicator, who will either uphold it, or will order the lender to pay you compensation.
Should the adjudicator agree with the bank that you were not mis-sold PPI, the decision can be appealed, and an Ombudsman will review your case. The ombudsman’s decision is final.
However, it is worth noting that due to the high volume of cases the Ombudsman is dealing with, it may take some time before your complaint is resolved.
Are there benefits for using a Claims Management Company?
There are benefits in using a claims management (CMC) company such as ours to make your PPI claim as the entire process is taken care by our case workers through our main brand Money Management Team Ltd.
We offer a free PPI check service to establish if you were sold PPI any financial products. The purpose of the check is to find out how many of your accounts have/had PPI. By going through this process other cases may come to light that you may have forgotten about.
Frequently Asked Questions Lloyds PPI Claims
Read our frequently asked PPI Claims related questions and answers. In the majority of cases the first step to making a PPI claim is to get a PPI check done with the lender.
If the checks reveal any PPI present on any of your accounts, you will be advised of your options on how to recover any PPI charges. Should you decide to proceed with PPIClaims.com we will require you to sign and return the relevant paperwork as soon as possible to begin your claims.
If your claim is rejected by Lloyds Banking Group, we will refer your claim to the FOS at no extra cost. The no-win, no-fee promise still stands.
How Do I Start my Lloyds PPI Claim?
We’d like to discuss the details of your case with you, so your complaint can be lodged with Lloyds on your behalf as quickly as possible.
- Start your Free PPI check process by using our online form. Completing the required information will help to establish if you have held a policy with Lloyds; or
- Complete our online claim form to start your claim.
Help to Calculate Your Lloyds PPI Refund
Millions are still owed money from mis-sold PPI and are entitled to make a claim. One of the most popular questions we get asked is, “How much could I be owed?” Without having the exact details of your borrowings, the payment dates, and the interest rate, it’s difficult to put an accurate figure on it. If you believe that you have been mis-sold PPI your complaint must be submitted to the relevant bank or lender before the PPI deadline.
Please use our PPI calculator to get an indication of what you may be entitled to include statutory interest if you were sold PPI on a loan, credit card or mortgage.
Organisations Who Can Provide Information & Help On Lloyds PPI Complaints
There are some regulatory bodies who can offer information and assistance regarding PPI: The Financial Conduct Authority, the Financial Ombudsman Service and the Financial Services Compensation Scheme.
The Financial Conduct Authority
12 Endeavour Square
Tel: 0800 101 8800
The FCA are the finance industry regulator, whose role it is to protect consumers. They will provide general information about PPI but cannot offer advice on an individual basis.
The Financial Ombudsman Service
Tel: 0800 023 4567
The FOS provide a free, independent dispute settlement service between financial businesses and their customers. They can deal with a wide range of finance based complaints including PPI.
Financial Services Compensation Scheme
PO Box 300
Tel: 0800 678 1100
The Financial Services Compensation Scheme(FSCS) may be able to offer compensation if a PPI provider you purchased a policy with is no longer trading, providing they were an authorised financial business.
Other organisations who can also help are:
168 Corporation St
Tel: 0344 477 1010
Citizens Advice have offices across the UK. They provide free, confidential and independent advice to help people overcome their problems.
The Money Advice Service
Tel: 0800 138 7777
The Money Advice Service was set up by the government to help people manage their money by offering free and impartial advice.