Payment Protection Insurance

LEGAL MATTERS - Byrne Carolan Cunningham SOLICITORS

Please explain Payment Protection Insurance to me. I took out a bank loan a number of years ago and I also availed of Payment Protection Insurance which the bank offered me. I was under the impression I was obliged to take out this insurance at the time. I recently lost my job but I am having difficulty in claiming through my Payment Protection Insurance.

Payment Protection Insurance (PPI ) refers to insurance that will pay you a sum of money to help cover your monthly repayments on mortgages, loans, credit cards, or catalogue payments if you are unable to work for certain reasons covered by your policy, such as death, illness, or accident, or if you become unemployed through no fault of your own.

When you secure a bank loan you are not obliged to take out additional PPI cover. PPI is quite expensive eg on a €10,000 loan a consumer may pay €2000 extra for PPI.

PPI should only be sold to consumers who request it and who will benefit from it. You may not be eligible to make a claim under your PPI policy if you:

Are under 18 or over 65

Work less than 16 hours a week

Are aware you may become unemployed

Are self-employed and go out of business

Are a temporary/ contract worker and you lose your job

Are aware, or should be aware, of an existing medical condition

Are unable to work because of certain common conditions, such as stress or backache

You may not be able to claim for redundancy if:

You work in a family business

You take voluntary redundancy

You claim during the first three or six months of taking out the policy

You should check the terms and conditions of your PPI policy. If, for example, you are self-employed you should never have been sold PPI and you may seek to reclaim payments made.

This column is prepared by Dolores Gacquin, solicitor. Byrne Carolan Cunningham have offices in Athlone, Moate, and Lanesborough.

A person should always contact their solicitor to obtain legal advice specific to their own situation. The above column contains general information and cannot be relied upon as legal advice.

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