As a result of a mis-selling that is currently at 18 billion pounds and counting, payment protection insurance, or PPI, is now widely discredited. Payment protection insurance is designed to cover your credit card or loan payments if you were unable to work due to unemployment, accident or illness. The good news is that you can still get the protection that you need.
There is a new product available that can replace the PPI. It is known as the payment waiver. This is a contractual guarantee that your payments will be waived if you are unable to make them due to sickness or unemployment. Under this contractual guarantee, you will not have to make payments for anywhere from six to 12 months.
Cuna Mutaul is the insurer that developed the payment waiver. It is also the first credit union to debut the Plane Saver, which is the credit union that serves British Airway employees and other aviation firms. Three personal loan companies and two building societies are set to launch their payment waivers within the next few months after they link with Cuna Mutual.
Plane Saver loans will now come with built-in protection against sickness and accident. However, unemployment will not be included in this protection. The protection that is offered can vary, depending on the lender. Members of the credit union will not be required to pay any type of premium or fee for the protection. Paul Walsh is the Cuna Mutual Europe’s chief executive. He has stated that Credit Union will take care of any of the fees that are required.
Some people think that companies will cover the cost of protection by charging higher rates for loans. However, Walsh has stated that Plane Saver will not be charging additional amounts for loans. The average annual percentage rate for a Plane Saver loan is 12.7 percent. According to Walsh, there are five other lenders coming on the scene, and they will not be changing their annual percentage rating. The unchanged annual percentage rating is one of the many things that people will like about the Plane Saver.
The Plane Saver waiver was developed after research had shown that over 66 percent of the borrowers had wanted coverage for sickness and accidents. Most of the members would have qualified for sick pay, but they most likely would have only received it at their basic pay.
Under the Plane Saver plan, the borrower would not have to make payments for 12 months if he or she were to become ill. However, it is important to note that there are stipulations put on the Plane Saver Plan. In order to be eligible for payment waiver, the borrower must take 30 or more sick days.
PPI Claims News
PPI Claims are falling according to regulator
Complaints about PPI Claims have fallen for the first time in three years according to the Financial Conduct Authority (FCA). In the 1st half of 2013 1.8 million PPI complaints were recieved compared to 2.2 million PPI complaints recieved in the previous 6 month.
However reports like these need to be questioned based on figures reported previously from the FCA within the 1st half of the year.
PPI Complaints to Cost the Banks an extra £400m in fees to FOS
Banks in the UK are set to be charges an extra £400m in fees by the Financial Ombudsman service (FOS) for dealing with PPI complaints. The FOS charges a standard fee of £550,00 per complaint regardless of whether the complaint is upheld against the financial insitution or not.
FCA investigates Two Banks for mis handling PPI Claims
The FCA has confirmed that they are investigating two Banks for mis-handling PPI Claims. This comes after a report last week that the Financial Ombudsman (FOS) has seen an increase of PPI complaints being filed with them.
PPI complaints that are rejected by Banks are typically sent to the FOS for review. Our review of this last week pointed out that the FOS found that 8 out of 10 PPI complaints were upheld by the FOS. This has lead to the FCA stepping in to investigate the two main Banks that are rejecting valid PPI claims from customers.
Tim Capper reports on Financial Mis-Selling for Maple Leaf Financial. Our aim is to ensure you get honest advice and proper guidance to ensure a suitable recommendation can be made to pursue a financial claim
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