Banks found guilty of mis-selling PPI
Thousands of people who believe they were mis-sold Payment Protection Insurance (PPI) are celebrating today after a High Court judge found banks guilty of mis-selling the cover.
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Banks could now be forced to pay out millions of pounds in compensation to those who were mis-sold the insurance - designed to their cover monthly repayments on loans and credit cards should they lose their job or have to stop working due to illness.
An estimated 16.1million PPI policies have been sold since 2005 - some of them to people who did not need them (such as stay-at-home mums or had no job to lose and therefore would never be able to claim) and in many cases, to people who had no idea they were even buying them. In the past, PPI was often automatically bundled into the cost of a loan, leaving consumers responsible for ticking a box to opt out.
The case had been to court previously, as the British Bankers' Association had tried to block new regulations, saying it could potentially cost them billions in compensation.
However, judges ruled in favour of customers, saying the new rules on mis-selling PPI could be applied retrospectively.
So far, upwards of 1.5million policyholders have complained. Three quarters of the complaints were upheld and compensation paid - with the average payout being £2,750.
Do you think you were mis-sold PPI? Have you already made a claim? Leave a comment below...
