Payment Protection Insurance - Over £3000

[complete novice]

Hi,

 

I am posting this on behalf of my stepdad. He suffered a stroke whilst at work in August 2002. He has not been able to work since. He knew the staff in the branch reasonably well and they were all aware of what had happened to him.

 

On the 13th September 2004 he was given a loan of £8,000.

The rate is 12.9%

The term is 84 months.

The monthly payment is £183.92 per month

The actual amount that goes towards the loan is £142.24.

This leaves £41.68 per month paying Payment Protection Insurance.

 

If the loan is left to run on until 2011 without overpayments he will have paid (84 x 183.92) £15, 449.28 including payment protection, without payment protection it would cost £11,948.16. I feel that the cost of £3,501.12 for insurance is ludicrous. He has paid £1,000.32 in the past two years.

 

The interest on the loan is front loaded and an early settlement is simply the loan amount + total interest – remaining payment protection insurance payments.

 

His income is £722 per month. The loan payments are soaking up 25% of his income. This leaves £539. Once the bills are out of the way it leaves £135 for food and miscellaneous expenses (less than £34 a week).

 

The reason is I gave the above information is to give an idea of how much the loan is costing in proportion to the other outgoings.

 

My step dad would like to cancel Payment Protection Insurance (freeing up the £41.68 per month). The loan was taken out when he was receiving disability living allowance and incapacity benefit (he still receives these to this day). He does not receive a salary from his employers or any other state benefit.

I stated earlier he has not worked since August 02 (two years before the loan was taken out). The branch member who sold the loan was well aware of this). She also knew what his income level was and that my step dad's employers had promised him his job back if he recovers.

 

Under of the circumstances I believe he has been missold the Payment Protection Insurance because:

 

1. He was not working when loan was taken out

 

2. If he became unemployed it would be either due to redundancy or retirement under medical grounds and both would provide enough income to cover the loan payments (both scenarios will provide a higher income).

 

3. He has been promised his old job back if he recovers which provides a much higher income and he would be able to maintain loan payments.

 

I found a template on this site re: cancelling Payment Protection Insurance and asking for a refund, I customised it and sent it to the Colmore Row address in Birmingham.

 

We received a response a month later stating that they can not cancel Payment Protection Insurance as the terms were explained when the loan was taken out i.e. It needs to be before 30 days had passed etc. They also stated they could not refund existing Payment Protection Insurance payments.

 

Is there anything more I can do to help my stepdad?

[lucid]

I don't think I can be of any use as I have never encountered PPI Insurance. But if you haven't seen it then it would probably be worth checking out Reid v Lloyds 2 - PPI Insurance ***SETTLED IN FULL***. It may have some useful information for you and your stepdad.

 

Good luck. Lucid

[Keith22]

Hi,

 

I'm struggling with reclaiming two massive PPI payments and I too have had the same response as you. I have argued the case from several angles (including attacking the sales target culture which exists in the Bank) over the last six months but they have not moved. I have now had their Final Response and they are not going to discuss it further. Looking at the material on the FSA and Ombudsman's sites I think a claim for repayment might have some success via that route. I know many people have a jaded view of the FSO but if they do reject a claim it still leaves the court route open. The problem is that unlike the unlawful charges with an established path for claiming refunds the issue of of PPI via the CC is a relatively untried procedure. I'm trying to get organised for this but it looks like the FSO might be the way to go first. I'll keep you informed as I go as it may help you to decide what to do - I'm determined to get my money back! Don't give up - lets get em.

[reidnet]

Hi Complete Novice..

 

I have sent you a PM, hope it is of some help..If not please let me know and I will give more advice..

 

Ian

[complete novice]

Thanks Ian,

 

I have sent the complaint to the Newport address as you have suggested. You have been a great help.

 

Louis

[reidnet]

Thanks Ian,

 

I have sent the complaint to the Newport address as you have suggested. You have been a great help.

 

Louis

 

No problem Louis thats what we are all here for ..to help one and other.

 

Good luck with your claim, Will keep an eye on here to see how you get on..

 

Ian

[complete novice]

I received a response today... no luck whatsoever..

 

Dear Mr Complete Novice

 

Thank you for your letter dated 25th September 2006, I have tried contacting you by telephone to discuss your concerns further, but we do not hold a current telephone number for you.

 

Your letter advises that you have been mis-sold your Loan Protection Insurance policy.

 

On the 6th July 2006 we received your concerns via our Customer Care Department in Birmingham, I then wrote to you on the 19th July 2006 with my findings.

 

I have enclosed a copy of this letter for your perusal, however, in the meantime if you have any further queries or concerns please do not hesitate to contact me on 0845 300 5599 (option 3),

 

Original Letter. This is the result of a phonecall three months ago.

 

Dear Mr Complete Novice

Thank you for contacting us about your Loan Protection Insurance policy.

I have tried calling you today but the number we have is unobtainable. I understand that you are unhappy that Loan Protection has been added to your Joan.

 

Whilst I empathise with the position that you are in, I am unable to offer a refund of your Loan Protection Insurance premiums.

 

Upon taking out your loan, as well as signing your Consumer Credit Agreement, you also signed an Optional Loan Protection Acknowledgement of Purchase form.

 

This you have signed accepting that you have received information relating to the 30 day cooling off period. You have also received information relating to the cost, cover, terms and conditions and exclusions of the Optional Loan Protection policy.

You also received your Loan Agreement and the Loan Protection policy documents contained within the policy document wallet.

 

I have also received information from the seller of your Loan Protection Insurance, as she recalls that when you took out your Loan Protection Insurance all exclusions as well as the benefits were discussed. She recalls that you were fully aware of all aspects of the Loan Protection and its exclusions.

 

I do appreciate that this news will be a disappointment to you but trust that you understand why the decision was made and that I have adequately explained the reasons for this decision.

 

However should you be dissatisfied with my response you do have the option of escalating matters within Lloyds TSB General Insurance. Should you wish to do this, please either write to the Customer Care Manager at the above address, providing your reasons for being unhappy and any further evidence you have, or alternatively Jet me know and I shall relay this information for you.

 

If for any reason, you were to remain dissatisfied with our final response you may have the right to refer your complaint to the Financial Ombudsman Service and we will tell you how to contact them. If we do not hear from you by l4h September 2006, your file will be closed.

 

yours sincerely

****

 

Customer Care - Lloyds TSB Insurance

 

Is there anywhere I can go from here or is this the end of the line?

[reidnet]

I have also received information from the seller of your Loan Protection Insurance, as she recalls that when you took out your Loan Protection Insurance all exclusions as well as the benefits were discussed. She recalls that you were fully aware of all aspects of the Loan Protection and its exclusions.

 

 

I pressume then that the Advisor was aware that you were not working and actually signed off on the sick?

 

If this is the case surely you should be claiming Now on the insurance ..

 

Ian

[topCatDC]

hi complete novice , if you are paying loan protection ask for a claim form .

if your Dad gets a doctors not and sends a copy in he can claim but cannot get it back dated more than a month . (i said i didnt know if i could claim acted dum)i have had to claim and that was what i was informed . check to see if there are any exclusions on the original loan agreement as your father took the loan out while he was on the sick .

and they usually exclude the illness if not make a claim . if he can get a note saying he cannot work for 12 months then they pay off the loan completly.most Doctors only give a maximum of 6 months at a time

 

if this helps great if not sorry

good luck Dave

[complete novice]

That could well help Dave

 

We've already had a consultant say that he recommended retirement and my stepdad is in no state to work (that's my opinion) the loan may well paid off in the near future then He has a medical on friday and I can speak to the Doctor involved then.

[topCatDC]

Hi complete novice,

dont for get any think with payment protection could be claimed this includes

credit cards, morgages even car finance

the forms are usualy straight forwades

make sure yo copy any sick notes as most companys will except these instead of getting the doctors to fill them all out (doctors can charge £20- £30 each)

if your stepdad gets DLA he may be able to get a car and an allowance for assistance .

ps good luck and please excuse my spelling

dave

[complete novice]

Hi again,

 

Digging up this old post.. we wrote to Lloyds requesting a refund of the insurance as it was missold. They declined the request. Yesterday my stepdad plucked it up the courage to make a claim.. to be told he can't make the claim because he was ill when it was taken out.

 

Who should I contact next to try and get a refund ? Ombudsman? CAB? Watchdog?