PPI Claim Letters

It’s been another bad couple of weeks for the UK’s major banks, with the biggest bank in the country, HSBC, announcing that is has followed the lead of Barclays and Lloyds by dramatically increasing the amount it has set aside (provisioned in finance lingo) forPPI compensation.

Barclays started the trend a couple of weeks back, unveiling plans to increase their already sizeable £1 billion compensation pot by a further £300 million.

Lloyds, complaining of ambulance chasing specialist companies then revised their figure by an additional £375 million.

HSBC has yet to confirm their increase but it is expected to be significant. However, profits for the group still look healthy with analysts expecting the bank to post between $5.2 billion and $6.4 billion.

Most disgruntled consumers would be forgiven for thinking it ‘serves Lloyds right’ following their mealy mouthed complaints regarding the conduct of specialist claims companies. However they are not alone in thinking these types of specialist firm are doing damage to finance sector and consumer alike.

Following a meeting between two of the major UK consumer groups and some of the heavy hitters in the finance sector, it is hoped that many customers will feel more confident about pursuing a claim directly. Doing so could save most customers over £800 in increased compensation amounts!

Figures released yesterday will not making good reading for the UK banks already suffering from the negative publicity surrounding the Payment Protection Insurance misselling scandal.

Leading consumer groups in the UK, think that customer are still entitled to in excess of £5 billion in compensation – alarming given that banks paid out half that amount already in 2011.

Sadly these groups think that many uninformed customers are missing out on a big slice of their compensation as they employ the services of a claims management company. This type of company, which as yet remains unregulated by the government, takes a 15-20% cut of the compensation awarded for their services. On average this is costing complainants over £800 per claim.

Moneysavingexpert is trying to highlight to customers just how straightforward and simple it is to pursue compensation from a bank if they feel that they were missold their PPI policy, launching a wave of radio adverts in the coming weeks.

This extra publicity will no doubt shine an even stronger light on the scandalous misconduct of banks who no doubt thought they could squeeze extra profits out of unsuspecting and loyal customers by selling them worthless policies … or in some cases insisting that the policy had to be taken out with them (which is strictly against their self avowed code of conduct).

Thankfully, for once, the UK consumer refused to take this treatment lightly and in 2011 a record number of complaints was lodged against the leading banks and other financial institutions such as store credit and insurance. Barclays was the most complained about individual bank, but Lloyds TSB has the ignominy of being the worst performer overall.

It appears obvious that the banks do not expect the furore to die down any time soon, as record numbers of people are being recruited into the banking system – largely to deal with the sheer volume of complaints that are being levied by customers!

It would appear that the furore over the mis-selling of PPI shows no sign of abating. Recently released figures show that complaints against UK banks increased by an astonishing 29% in March, hitting a record level of over 1.6 million complaints.

The most complained against individual bank was Barclays, who dealt with an astonishing 251,000 NEW complaint in the first 6 months of 2011 and an even higher sum of 281,000 for the second half of the year.

Bank of Scotland showed a similar trend opening 130,000 complaints in the first half of the year which rose dramatically to over 200,000 in the second half of the year. Lloyds second half year complaints tally was an eye watering 240,000!

Simon Thompson, Managing Director of Precision Claims, said it was unsurprising that the complaints were escalating as the scale of the mis-selling of PPI was pretty obvious from early on. He thinks banks will continue to see increased complaint levels and thinks the FSA should work even harder to force banks to contact customers who they know have been mis-sold policies.

As well as banks, insurance companies were also in the spotlight, with one major insurer Aviva, openingover 13,000 complaints.

The increasing number of people complaining about their treatment is leading to increasing business for PPI Claim companies, but more and more people are pursuing compensation under their own steam. With the help of a good PPI Claim Letter most customers can save time and money doing it themselves knowing that they have the support of the Financial Ombudsman if they are unhappy with the bank’s behaviour.