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Maximum Compensation - Why are some PPI compensation pay-outs so BIG?

12 February 2018

Payment protection insurance (PPI) is now infamous for the unfair way in which it was sold to millions of customers. The collective PPI compensation bill across British banks and lenders now stands at nearly £30 billion, far bigger than anyone predicted.

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With the PPI deadline of August 2019 in place, you may be considering making a claim for mis-sold PPI. Spurned on by stories of life-changing compensation amounts, you may be wondering just why and how some compensation payments are so BIG.

5 Reasons Why PPI Claims are Worth a Lot of Money

Compensation for mis-sold PPI is calculated so that you, the customer, are put back to the financial position you would have been in had you not been sold PPI.

How this is calculated depends on various things but when it comes to BIG pay outs, there are five reasons why the compensation settlement was so big.

  • The number of accounts - you will find that the majority of people who have received thousands back in PPI compensation had several accounts. From personal loans to credit cards and mortgages, PPI could be lurking on more than one account - and you could be entitled to compensation across them all.
  • Time - many who have received BIG PPI compensation payments (over £100,000 on one case) won these larger amounts as they had been paying for PPI for a long, long time. In fact, some customers had been unwittingly paying for PPI for over ten years - and it all adds up.
  • How PPI premiums were charged - on some loans the PPI premium was a fixed monthly premium but on others, such as credit cards, PPI premiums calculated as a % of the amount outstanding each month. If you did not pay off your credit card bill each month, this meant you were paying a % of the amount outstanding. This could add a substantial amount to the account each month.
  • Fees and costs - in recent cases, banks, lenders and financial institutions have not been reimbursing their customers the full amount of PPI compensation they are entitled to. This is because fees and costs that were added to many accounts as a result of them being pushed over their credit limit by the addition of PPI premiums, have not been reimbursed as part of the compensation.
  • Unfair commission - banks, lenders and brokers also charged commission of sales of PPI. If this was more than 50% of the cost of the policy and you were not told about it, this is also reimbursed. The cost of some brokers commission was as high as 67%.

How big is your claim?

Why not give Scottish PPI Claim a call? With many years' experience and a high level of success if helping people claim back PPI compensation, it could be the best phone call you make today.