Payment protection insurance claims, also referred to as PPI claims are commonly discussed when it comes to the way in which they work with payment protection insurance on loans however credit cards were sold with payment protection insurance added and usually mis sold to customers through a range of ways.
More often than not this payment protection insurance was added without the customer who was applying for the credit card even realising it and this can be primarily put down to the fact that in the 2000’s there was a huge growth in the number of online only credit card companies as well as the increase in the number of banks or telephone based companies moving their application forms online. Such companies included the likes of Egg, Capital One and MBNA and all three of these companies regularly appear in the top 10 most complained about companies and banks in regards to payment protection insurance which are released by the Office of the Financial Ombudsman on regular intervals. In addition to this banks such as Lloyds and Barclays which are two of the most complained about banking groups also offered credit card applications online. Many customers preferred to apply online for their credit cards because of the generally quicker application process, the instant decision and the ability to apply in the convenience of their own time. However it was the online application process which had one major problem due to the way it was written and the process the customer had to go through in order to apply for the credit card.
The majority of credit card and even loan application forms automatically made the applicant accept the fact payment protection insurance was going to be added to their account through an opt in form. If the customer did not want the payment protection insurance policy then they needed to carefully read the often tricky worded statement and then choose to opt out.
This in itself had lots of flaws beyond the actual misleading nature of the banks and their application forms. Automatically accepting that the customer would want the policy included on their credit card did mean that no checks were made to see whether or not the customer was even allowed to hold such a policy through their type of employment or checking to see whether any previous health conditions would rule them out of the policy. Beyond checking their eligibility the opt in form did not make any checks to ensure that the customer fully understood or were even aware of the terms and conditions which were laid out by the policy.
Payment protection insurance added onto credit cards was often given different names depending on the credit card provider so it is essential that anyone with a credit card that was taken out in the last 10 or more years, especially online checks the fine print to see if there are any mentions of cover that sounds similar to payment protection insurance. These different names include things such as credit cover, credit protection insurance and credit insurance. You may find if you had multiple credit cards which was a common thing to happen, or one credit card and a store card that you will have multiple credit card payment protection insurance policies. If these were all mis sold then they you can complete PPI claims and get these back. If you do not have time to make individual claims for each unique policy to each provider by yourself you can contact the likes of PPI Claims Management Company and they can complete all the leg work between each of the different credit card providers for you then provide you with your pay out in one lump sum at the end of this.
Another way in which PPI claims on credit card differs to the PPI claims on loans is down the way the payment protection insurance policy premiums were calculated, i.e. the money that the customer paid each month for the policy and as a result the way the potential PPI claims pay out which is received is therefore calculated. Unlike loans the ability to make an accurate estimation on the payment protection insurance policy is more difficult as the total amount that was owed on the credit card could vary massively from month to month from nothing one month to thousands next month. Unless you know how much your balance on the credit card was each month it is impossible to work out the potential pay out accurately. A PPI policy cost approximately 75p for every £100 on the balance and along with the refund you will be awarded 8% of the total policy cost in compensation.
The information regarding credit card PPI claims tends to also apply to PPI claims which are being made on store cards as these usually operated in the same way as a credit card.