The deadline for people making PPI claims expired in August 2019, but banks could now be facing more hefty payouts in ‘PPI 2’
Millions of consumers across the UK may now be eligible for new PPI payouts of up to £40,000 following a recent court ruling on hidden commission fees.
Payment Protection Insurance (PPI) was a financial product sold to millions of borrowers alongside a loan, credit card or mortgage.
The deadline for people making PPI claims expired in August 2019, but banks could now be facing more hefty payouts in what is being dubbed, ‘PPI 2’.
And the Mirror Online reports that millions of customers across the UK may be eligible for compensation of up to £40,000.
People were told PPI would cover their debt payments if they died, became ill or disabled, lost their job or were unable to repay debt for another reason.
The problem was that there was also a series of exclusions, meaning it was mis-sold to people who could never claim on it, or in some cases were wrongly told they needed it.
The so-called ‘PPI2’ centres around how much commission was pocketed by a lender or broker following a PPI claim, and if that amount was explained to the customer.
Experts believe those who have been denied a payment, received only partial refunds or have never made a claim for a mis-sold PPI policy, could be entitled to money back.
This is because under the old rules, banks only had to refund commission above 50%.
In most cases, you will need to have been sold the PPI before April 2007, and still have been paying the product it was attached to on or after April 2008.
You will not be able to make a claim if you have already received a full refund from your PPI policy.
Martin Richardson, director of legal services at MoneyPlus Legal, which is looking into more than 13,000 ‘PPI 2’ cases, told The Sun the latest lost appeal could pave the way for millions more people to put in a claim over unfair commission.
He said: Banks have been spending hundreds of thousands of pounds trying to stop these claims but judgment means they are now all ready to move forward. I’m glad that the judges have said it is clear that the bank deliberately concealed the commission as it knew customers would be unhappy and unlikely to take out the policy.
Experts suggest payouts could be between £1,000 and £40,000, with an average compensation figure of £3,000, however, claims for ‘PPI 2’ will need to be made through law firms.