Benefit ceiling on more than one PPI policy

[stevemcmli]

I recently came across something which caused me considerable frustration. It is my understanding that there is a ceiling the total amount that can be claimed on PPI policies. As far as I can ascertain this ceiling is a percentage of normal monthly pay (Net pay, I think) and is something like 60%.

For example; Mr Hypothetical (me-maybe!) earns £1000 per month and has PPI on several credit cards and a PPI policy with an insurer to cover his mortgage ( like me!). Mr H claims on his mortgage PPI which pays £500 per month and then on a CC PPI which pays his minimum monthly payment of £100. When Mr H claims on his next CC PPI, the amount it pays out is deducted from his first PPI because of the ceiling.

The net result is that we can be shelling out hundreds of pounds per year in PPI on which we can never claim.

My questions now are:

1. Are my suspicions correct? Is this widely known about?
2. Is this not a type of misselling? I have never been made aware of this maximum until recently.

If so they're selling people policies which are totally useless!!!

[gizmo111]

Where did you get the information re this ceiling from? It is my understanding that if you claim on certain policies it is counted as income for benefit purposes.

[stevemcmli]

Hi Gizmo, Have checked and I am quoting from the Post Office Lifestyle Protection Policy booklet (provider AXA). Section 11, para 4 which states.

"If during a claim for disability or unemployment you are receiving any continuing benefits then we will reduce the amount claimed under this policy, so that the total sum of the benefits you receive under this policy plus any continuing benefits does not exceed 60% of your pre-claims earnings."

In my view that's a pretty significant condition to have buried in the small print, when it should be proclaimed in the so called "Key Facts" statements. The net result for me (I'm claiming redundancy) is that I'm seriously overinsured in terms of PPI!!

[lilal]

it depends on the type of ppi ,like if it was taken out just to repay a loan,stand alone to repay mortgage or loss of earnings . have a look here Credit card protection plans ....the impact of different policies on income support bit at the bottom hth