Original Artice From 2014 – Updated in 2017 and 2019 to take account of legislation changes.
The issue of mis-sold payment protection insurance (PPI) was very widespread in the UK and it looks like the banks also tried to make easy profits from it here in Ireland.
Note: The UK Financial Conduct Authority set a deadline for PPI refund claims – which is August 29th 2019. This deadline does not affect any such claims in the Republic of Ireland.
It came to light around 2011 that several financial institutions in Ireland (just like in the UK) had probably been selling PPI to people who had no need for it or could not benefit from it. It also looks like that PPI was added on in some cases without customers even being asked about it.
In 2015 there were also problems with Card Protection Policies
In 2013, several companies were forced to review all their Irish PPI sales since July 2007 at the request of the Central Bank. See Here https://www.moneyguideireland.com/payment-protection-insurance-investigation-the-latest.html
The July 2007 cut off date was used because that is when the Consumer Protection Code came into force. It does not mean that customers cannot claim refunds prior to July 2007. (But it will be more difficult).
The review of PPI in Ireland was completed in early 2014 and all customers that were sold a PPI policy by one of the banks in the review should have received a letter about the policy.
Did You have a PPI Policy ?
If you took out a loan, a mortgage or got a credit card or an overdraft you were probably offered or sold an insurance policy to cover some or all of the repayments if you lost your job or got sick.
This type of insurance is known as Payment Protection Insurance or PPI.
Some people might not even realise they had a PPI policy.
You can find out by asking your mortgage provider, loan provider or credit card or store card provider if you have PPI (or had one in the past )
Have you been mis-sold Payment Protection Insurance ?
You may have been mis-sold PPI if one or more of the following applied to you…
- Was the fact that PPI was optional made clear to you? Were you told that you had to take out PPI at the same time as the loan?
- Did the sales adviser tell you about any significant exclusions under the policy – for example, the exclusion that says you won’t be covered for any pre-existing medical condition?
- If you had to pay for the PPI as a single payment, did the adviser make it clear that the insurance cost would be added to the loan and you would be paying interest on it?
- Were you unemployed or self-employed at the time of the sale?
- Were you working 16 hours a week or less when you were sold the PPI?
- Were you sold PPI when you were on contract work?
- Were you not asked if you had any other insurance which would cover the loan?
- Were you led to believe that your chances of securing the loan were better if you purchased PPI?
- Were details of your medical history not asked for?
- Did you feel pressured into purchasing the PPI?
- Were the terms and conditions of the fine print not properly explained to you?
Getting a PPI Refund
1) If you took out a PPI policy in Ireland since July 2007 you should have been contacted in 2014 by the bank that sold it to you.
If the sale did not comply with the consumer protection code – you should have been offered a full refund of premium plus interest. (Latest info on Review Progress Here)
2) If you were not offered a refund of your PPI – but you believe you were missold it – you can still make a complaint to the bank. Write to the bank or credit card company that sold you the PPI. Tell them in writing why you think it was mis-sold to you – listing the reason(s) (see above) and ask them for a refund of the premiums.
If the bank or lender refuses to give you a full refund you can then send a complaint to the Financial Services and pensions Ombudsman. (FSPO)
Update: August 2017.
One big problem here in Ireland was that prior to August 2017 – if you complained more than 6 years after the PPI start date – the complaint could not be dealt with by the ombudsman. More about the 6 year rule here
This has now changed – and now you can make a complaint to the Ombudsman on a policy more than 6 years old if you became aware of a problem with it in the past 3 years. So – if you were told in 2002 that PPI was compulsory – but did not find out until 2014 that it wasn’t – then you can now make a complaint.
More about this Change to the 6 Year Limit here
FSPO Contact details: Phone: +353 1 567 7000
The Small Claims Court may also be an option – we know of at least one successful case taken against PTSB for misselling of PPI. It only costs €25 to go to the small claims court – but there is a limit of €2000 per claim.
Some people think that the Statute of Limitations puts a 6 year limit on pursuing refunds – but that might not be the case.
The law states that in the case of fraud or mistake – “the period of limitation shall not begin to run until the plaintiff has discovered the fraud (or mistake) or could with reasonable diligence have discovered it.” ….
Average refunds of mis-sold PPI premiums were about €3250 in the UK – so it’s worth doing. If you have had very large loans or credit card balances – the PPI payments could be thousands of Euro.
In the UK – consumers have already claimed back over £24 billion – (late 2016) and there are thousands of more refund claims in the pipeline. See https://www.moneyguideireland.com/payment-protection-insurance-refunds.html