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Why Does PPI Compensation Awards Vary?

We have all read the headlines and marvelled at some of the large payment protection insurance (PPI) compensation settlements customers have received.

But, just why are some of these compensation settlements so high when compared to the average pay out of £2,750?

PPI & Credit Cards

Many of the larger pay outs are around PPI policies on credit cards. There are several factors why PPI compensation can reach such large proportions:

I. TIME - many of the customers who have received five-figure sums in PPI compensation had their credit card over along period of timeand therefore, could have been paying out hundreds of pounds each year for the PPI policy.

II. NUMBER of credit cards - one customer who received a large pay out of over £65,000 hadmore than one credit cardand had also had these for a long period of time. These two factors combined meant that the compensation due soon totalled a large amount.

III. INTEREST - what does significantly boost PPI compensation is the application of interest andhow the premium each month was calculated. PPI premiums varied on credit cards as the amount a customer paid in PPI premiums each month depended on the outstanding balance. Hence, if you were up to the card limit and only paid the minimum each month, your monthly premium would be higher than if you paid it off. In this way, one business woman with two cards over many years which were often at their limit, received over £82,000 in compensation.

Why do credit card providers have such a large slice of the PPI compensation market?

Applications for credit cards were easy forms to fill in back in the economic heyday of the 1980s and 1990s, more so with the advent of easy credit with online applications.

Many applicants will not have noticed a small box at the end of the very small print that informed the customer PPI was available on their account.

Our Terms of Services - Clear, Transparent and Easy to Understand

Payment Protection Scotland's 'small print' is not small or hidden. We offer a fully transparent service and our terms and conditions are available on our website.

Our friendly customer service advisers will be more than happy to talk through the no win, no fee terms of service we offer.

We are a claims management company that specialises in making PPI claims on behalf of customers. We will assess your case and suggest the best way forward.

Contact us today for further information.

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