have I been mis-sold PPI on Lloyds TSB personal loan?

[nathanlw]

Hi there

Just stumbled on these forums having done a quick Google search for some details relating to a PPI issue that has cropped up last week, if someone with some knowledge/experience could give me a few pointers I'd be very grateful.

Firstly, some context and also details relating to my employment status at the time the PPI was taken out that may turn out to be important, I will try and be as clear and as brief as possible:

Back in 2003 I was advised, as part of an in-branch annual review, to take out a personal loan to get rid of a credit card I had with Lloyds TSB..a fairly simple transaction, I thought, with the one exception of my employment circumstances at the time; I was (and still am!) in the process of building a small business (in the form of a small Ltd company) of which I am the principal director. I was neither registered as self employed for tax purposes or on contract to/salary from my company at the time the loan was taken out, and for a significant period afterwards.

Given my extremely sketchy/unpredictable earnings, I was advised that a balance transfer to a personal loan would probably be very possible, but at a high rate of interest in order to "balance the risk". I was further told that the addition of loan protection insurance would unlock a lower rate of APR because the "risk" would be significantly lowered. It made sense to me at the time, and in principal I had no objections, although I specifically asked for clarification as to a) how the bank would classify my employment status, and then b) how this would affect any subsequent claims on the policy. The employment issue was my main concern as I already had sickness/life cover on another policy (ironically, as part of the Lloyds TSB credit card I was seeking to clear!)

The adviser at the time couldn't answer my questions relating to my employment status and eligibility to claim should my company fail there and then, but promised to get clarification and send it on in the post. Of course this never happened, and to this day the only paperwork/policy literature I received was the copy of the policy document itself which I requested last week, having only just started to delve into this properly.

The copy of my policy document does indeed make a brief reference to cover being extended to the self-employed, but when I asked for clarification about this from the personal loans customer services dept I was told that "evidence of a termination of supply of work, e.g. letter from long-term customer or some other evidence that trading has ceased" would have to be presented in order for a claim to be accepted.

Which FINALLY brings me to my question/issue, and back to the crux of my concerns on the day I was actually sold the PPI.


If my understanding is correct, the situation seems to hinge around another part of the policy wording, under a general exclusions section, which reads:

"What you are not covered for ... Unemployment which was caused by or is a result of ... any wilful act by you"

Since I am the principal director of the company that I work for on a self-employed basis (I invoice the company on an ad-hoc/project basis, rather than commit to a structured PAYE setup), any cessation of trading would quite obviously have to involve a "wilful act" on my behalf; e.g. winding up of the company, in which case I should be technically unable to claim under these terms.

Does this amount to a clear cut case of the policy being mis-sold?

I remember clearly bringing this up during the review meeting that led to me taking out the loan + PPI (although obviously without having had the benefit of the actual policy wording on the day!) as it struck me unlikely that I could be both the trigger and the beneficiary of a PPI claim; my understanding of the policy document is that this is indeed the case.

Sorry if this came out a bit long winded, but I'm getting nowhere with the various Lloyds TSB helplines etc. and would really appreciate some advise as I can't seem to find any threads on this forum where people have made PPI claims in similar personal circumstances

Best,
Nathan

[old_andrew2007]

Hi
I haven't a clue on PPI, only replying if that OK to bump your thread
Regards

Andy

[hellhasnofury]

Originally Posted by nathanlw

Hi there

Just stumbled on these forums having done a quick Google search for some details relating to a PPI issue that has cropped up last week, if someone with some knowledge/experience could give me a few pointers I'd be very grateful.

Firstly, some context and also details relating to my employment status at the time the PPI was taken out that may turn out to be important, I will try and be as clear and as brief as possible:

Back in 2003 I was advised, as part of an in-branch annual review, to take out a personal loan to get rid of a credit card I had with Lloyds TSB..a fairly simple transaction, I thought, with the one exception of my employment circumstances at the time; I was (and still am!) in the process of building a small business (in the form of a small Ltd company) of which I am the principal director. I was neither registered as self employed for tax purposes or on contract to/salary from my company at the time the loan was taken out, and for a significant period afterwards.

Given my extremely sketchy/unpredictable earnings, I was advised that a balance transfer to a personal loan would probably be very possible, but at a high rate of interest in order to "balance the risk". I was further told that the addition of loan protection insurance would unlock a lower rate of APR because the "risk" would be significantly lowered. It made sense to me at the time, and in principal I had no objections, although I specifically asked for clarification as to a) how the bank would classify my employment status, and then b) how this would affect any subsequent claims on the policy. The employment issue was my main concern as I already had sickness/life cover on another policy (ironically, as part of the Lloyds TSB credit card I was seeking to clear!)

The adviser at the time couldn't answer my questions relating to my employment status and eligibility to claim should my company fail there and then, but promised to get clarification and send it on in the post. Of course this never happened, and to this day the only paperwork/policy literature I received was the copy of the policy document itself which I requested last week, having only just started to delve into this properly.

The copy of my policy document does indeed make a brief reference to cover being extended to the self-employed, but when I asked for clarification about this from the personal loans customer services dept I was told that "evidence of a termination of supply of work, e.g. letter from long-term customer or some other evidence that trading has ceased" would have to be presented in order for a claim to be accepted.

Which FINALLY brings me to my question/issue, and back to the crux of my concerns on the day I was actually sold the PPI.



If my understanding is correct, the situation seems to hinge around another part of the policy wording, under a general exclusions section, which reads:

"What you are not covered for ... Unemployment which was caused by or is a result of ... any wilful act by you"

Since I am the principal director of the company that I work for on a self-employed basis (I invoice the company on an ad-hoc/project basis, rather than commit to a structured PAYE setup), any cessation of trading would quite obviously have to involve a "wilful act" on my behalf; e.g. winding up of the company, in which case I should be technically unable to claim under these terms.

Does this amount to a clear cut case of the policy being mis-sold?

I remember clearly bringing this up during the review meeting that led to me taking out the loan + PPI (although obviously without having had the benefit of the actual policy wording on the day!) as it struck me unlikely that I could be both the trigger and the beneficiary of a PPI claim; my understanding of the policy document is that this is indeed the case.

Sorry if this came out a bit long winded, but I'm getting nowhere with the various Lloyds TSB helplines etc. and would really appreciate some advise as I can't seem to find any threads on this forum where people have made PPI claims in similar personal circumstances

Best,
Nathan

Hello Nathan,

In a quick sum up to your question

Does this amount to a clear cut case of the policy being mis-sold?

YES

Have you sent a S.A.R - (Subject Access Request) to get all of the information that you need, the premium and interest charged for the ppi. If not send a SAR you will find the template letter in the ppi stickies. It costs ten pounds and they have 30 days to comply.

Once you get this information that you need, work out the amount that you are going for, the ppi and the interest they charged you. add them together and work out the contractual rate of interest from the date of the loan to now

Send them your preliminary letter and give them 14days ( there are a few kicking about the ppi forum) send everything recorded delivery and keep all copies receipts.

If you get no response or an unfavourable response, send them a letter before action and if no response or they are messing about, your opinion then is report the case to the financial ombudsman (dependant of the year the loan was taken) or issue a N1 at your local court.

If you get stuck or need help just ask