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Buzzybee

Is there a law which states PPI is not compulsory

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Hi

 

I am in the process of taking my bank to court as they missold me PPI (the court has cashed my cheque now and I am getting all my documents together for my day in court!).

 

I wanted to know where abouts in English law it states that payment protection insurance is not compulsory and I should be given the opportunity by my bank to shop around for a cheaper policy.

 

Is there anything mentioned in the Consumer Credit Act to say it is not compulsory?

 

Could anyone help please?

 

Thanks

Edited by Buzzybee

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There is no law against selling PPI products.

 

Try: Statutory Instrument 1999 2083: The Unfair Terms in Consumer Contracts Regulations 1999;

Schedule 2: Indicative and Non- Exhaustive List of Terms Which May Be regarded as Unfair

 

(i) irrevocably binding the consumer to terms which he had no real opportunity of becoming acquainted before the conclusion of the contract.

 

This means if they did not give you time to read the contract properly before signing it could not be fair to impose that cost on you. You should have been given at least 24 hours to read the contract or had the terms explained to you and the ramifications of default been made. The additionlal cost of PPI makes the burden of repayment even harder to bare for the consumer.

 

This act replaces the Unfair Terms Act of 1994 which came into force on July 1995.

 

The explanatory notes towards the end of this downloadable pdf file online, explains further that: The Regulations provide that an unfair term is one which has not been individually negotiated and which contrary to the requirments of good faith causes a significant imbalance in the parties rights and obligations under the contract to the detriment of the consumer (regulation 5). If a PPI has been added to a fixed loan contract then the PPI become spart of that contract in comparison where you have an individual PPI contract and so it is much easier to apply this Unfair Terms to a contract.

 

An Unfair Contract term is not binding on the consumer. Of course one still has to prove that it is unfair, and (i) above should be one consideration if that was the case.

 

There is also the Consumer Credit Act 1974 and 2006. Unfair terms are geneous to the consumer and in a case where there is alleged unfairness it is for the defendent to prove otherwise. I.e. It is the bank that has to defend and prove the contrary.

Edited by ieuanMr

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