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PPI complaint numbers continue to soar

PPI complaint numbers continue to soar

Category: Insurance

Updated: 05/03/2013
First Published: 05/03/2013

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Volumes of complaints in relation to mis-sold payment protection insurance (PPI) have grown at an "unprecedented" rate according to the Financial Ombudsman Service (FOS).

A total of 283,251 new complaints were received by the service during the second half of 2012, equating to around 2,000 complaints being received every day.

Millions of mortgage, credit card and loan customers were sold PPI by banks to cover repayments in the event of them falling ill or losing their jobs, despite many not actually wanting or needing such cover. In some cases, PPI was automatically sold or added to the product without the customer being aware.

The mis-selling of PPI is considered to be the biggest scandal in the history of the banking sector, resulting in UK banks setting aside £15 billion to deal with compensating affected customers.

High levels of complaints have also meant many banks are struggling with processing a back-log of compensation payments. Last month, Lloyds Banking Group was fined £4.3 million by the Financial Services Authority (FSA) for failing to redress customers within the agreed 28 day timescale.

Natalie Ceeney, chief financial ombudsman, said: "The number of PPI complaint levels show no sign of slowing, consumers are increasingly having to wait longer to get their complaints sorted, with many businesses still continuing to cause unnecessary delays."

What next?

How to independently claim back mis-sold PPI
How to complain to a financial services provider

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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