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The Objective Of Payment Protection Insurance Policy

This article is written for public Benefits. if you read this article, you will get an idea about Payment protection policy.

The objective of payment protection insurance policies is to plan for those unpredictable moments. PPI covers the borrower against sickness, loss of life, injuries, lack of employment and any other circumstances which prevent them from earning wages so that one can quickly repay the debt without any kind of tension . It gives guarantee to repayment of a particular debt if your circumstances change in such a way which you can no longer afford. If you can't work for a period of more than 30 days, if you have a payment pension plan in place and you meet your policy's criteria to receive coverage, you should be able to make a claim and have your payments made, usually for up to 12 months. Though, till the time PPI is used to offer protection to the loan amount it is fine, but when it is used extract some more revenue from the borrower's pocket then there is something incorrect. Sometimes PPI becomes a forced insurance plan. It comes along with a enormous purchase. It is also forced on someone who buys loans.

There are over twenty million payment protection insurance plans in force in the United Kingdom. Some of these were mis-sold to the consumers. Common reasons why PPI policies could be considered as being missold to customers are as follows:
  • You were informed the PPI was necessary for you to get the loan.
  • The cost of the policy was like to the total benefits under the policy if you made a claim.
  • You were employed on a temporary or contract basis when the PPI was sold to you.
  • You were under 18 or over 65 when the PPI was sold to you.

A report issued by the FSA in August 2010 recommended that over the next 5 years, there would be over 250,000 claims made each year, totalling 2.7 billion. If you were mis sold payment protection insurance within the last 6 years, you will be able to submit a claim. The first step to making a claim is to write a letter to the company that sold you the policy. You have to be prepared to argue your case. With the increased awareness of mis sold payment protection insuranceFeature Articles, it is natural to expect the lenders beginning to realize that they have to cover themselves when it comes to giving out loan to borrowers. You have the option of getting in touch with a company that specializes in reclaiming money or you can forward your request to Financial Ombudsman Service.

Source: Free Articles from ArticlesFactory.com

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