MoneySavingExpert and Which? have joined forces to increase
awareness of how easy it is for consumers to reclaim mis-sold payment
protection insurance for free/
The aim to tackle head on the unscrupulous claims management
companies that exploit consumers wanting to claim back their money. You will
almost certainly have been cold-called by at least one of them, even if you
have never taken out a loan or bought related payment protection insurance. The
authorities have put over 700 such firms, who often ride roughshod over rules
on cold calling and payment protection insurance, out of business. Most use
hard sales tactics using sales people who have no idea of the legality or
otherwise of what they do. Some are polite, but as I was writing this news item
I was called by one who ended up screaming abuse at me and claiming the law was
powerless to stop him.
MoneySavingExpert.com and Which? are working with all the major
banks and credit card providers, plus the financial regulator. The aim is to get all parties working
together to help people get back the money they are owed and help restore trust
in the claims process.
The two are also to launch a radio advertising campaign to
raise public awareness that they can easily reclaim for free.
Millions of people have been mis-sold the insurance, but a
billion pounds has already gone to claims management companies. Many consumers do not realise there are
simple, easy to follow steps to reclaim for free, and that sharks are taking a
cut of what they see as easy money.
With an average payout of £2750, and claims management firms
taking a fee of 25% plus 20%VAT as standard, consumers could pay £825 for
something they could easily do themselves.
Martin Lewis of MoneySavingExpert says, “There is over £5
billion of claims still to be given out but, scarily, almost £2bn of that could
end up in claims firms' coffers, rather than people's pockets. Often all these
firms do is send out similar template letters to the ones we give people for
free. You do not need to pay to reclaim, you can do it yourself and keep all of
your cash for free."
Richard Lloyd of Which? adds, “It is a scandal that too many
claims firms have been ripping off consumers who do not realise there are
simple steps they can take to claim back their money themselves. Don't get
Income protection insurance news: 23 April 2012