Not just Lloyds cutting PPI claims

[Michael Browne]

Since February 2013 Lloyds Banking Group has been cutting the compensation it pays to payment protection insurance (PPI) claimants, on the basis that customers could have bought PPI cheaper somewhere else, so they only have to pay the difference between the two.

 

Well surprise, surprise other banks have been doing the same.

 

Barclays, Lloyds Banking Group and RBS confirmed they used comparative redress during the following periods:

 

• Barclays offered comparative redress between October 2012 and October 2013.
  
• Lloyds Banking Group has offered comparative redress since February 2013.
  
• The RBS Group has offered comparative redress since early 2013.
  

http://www.moneysavingexpert.com/news/reclaim/2014/04/reclaimed-ppi-some-banks-have-underpaid-borrowers-100s

[Andybars]

The RBS letters state that it should have sold the customer a regular premium policy - this despite the fact that it didn't even offer a regular premium policy at that time so could never have done so !

[Hortz]

Since February 2013 Lloyds Banking Group has been cutting the compensation it pays to payment protection insurance (PPI) claimants, on the basis that customers could have bought PPI cheaper somewhere else, so they only have to pay the difference between the two.

 

Well surprise, surprise other banks have been doing the same.

 

Barclays, Lloyds Banking Group and RBS confirmed they used comparative redress during the following periods:

 

• Barclays offered comparative redress between October 2012 and October 2013.
  
• Lloyds Banking Group has offered comparative redress since February 2013.
  
• The RBS Group has offered comparative redress since early 2013.
  

http://www.moneysavingexpert.com/news/reclaim/2014/04/reclaimed-ppi-some-banks-have-underpaid-borrowers-100s

 

This is poorly reported nonsense. The original article was written by someone who obviously has no understanding of the issues involved.

 

Comparative redress is expressly permitted by FCA rules. It is not a "loophole" as claimed in some of these articles, it is a perfectly fair and logical approach to redress if applied in the right situation (and obviously I can't comment on Lloyds' approach to how they apply it). The problem stems from the myth propagated by CMCs and subsequent public misunderstanding that a successful PPI complaint automatically results in a full refund.

 

This link makes it out as though it is some kind of underhand scheme by banks to catch people out without them knowing it. In fact, any letter offering comparative redress should clearly explain what is being offered and the reason for the offer. If the complainant doesn't agree they are then free to take it to FOS.

[Andybars]

Whilst the article is clearly written in simplistic terms, the underlying issue is that comparative redress is being used in wholly inappropriate situations in many (but not all cases).

 

Whilst I agree that any letter offering comparative redress should explain what is being offered many do not and in fact some make no mention of the fact that this method is being adopted, merely stating that an offer is being made "broadly in line with FOS guidance".

 

Certainly for a lender who did not offer a monthly policy it is inappropriate, the other shady practice is using the FCA default of £9 per £100 of cover by those lenders who did have a monthly policy and who charged less than this.

[Conniff]

Come on, lets get real, the banks have worked out a new way to rip people off.

 

 

All this comparative nonsense can only be claimed if they told the customer at the time that other companies offered the 'same' insurance at a cheaper price. If they said nothing and just signed them up, then pay up and include the statutory interest as well.

[intend]

Agree with Conniff - just another underhand way to reduce their liabilities.

 

would suggest that all future claims include a statement stating that you would not have purchased this and do not make the assumption I would have in order to reduce the redress.

 

A total rip off that makes me more determined to reclaim