It’s Thursday – let’s get serious before the weekend hits. I’ve gone for the big one, a topic currently garnering pace in the media world – P.P.I. 

People keep talking about it, but to quote my dear friends “WTF IS IT?”  Why am I getting all these calls and emails from people trying to talk to me about PPI?

Right – let’s start with the basics.

PPI stands for Payment Protection Insurance – it’s normally taken out as insurance to cover your repayments in case you stop being able to pay. And we’re talking repayments for any sort of finance – not just personal loans, but also credit cards, store cards and car finance. 

Photograph: Guardian


What’s the big deal?

The big draaama with PPI recently is that the lender is supposed to tell you a couple of things when you first take it out and, well they haven’t – to quote Cilla Black “surprise surprise”.. 

Firstly, they should let you know if your loan arrangement includes PPI – and if so, your lender should explain to you how much extra it’s costing you. But in reality, this has not always happened. And that’s where the drama starts..

Also – there are so many different types of PPI policies,  even if you knowingly took out insurance, there’s also a chance that you were sold the wrong type of policy and tricked into paying a higher premium for cover you don’t need. More drama.

What’s this compensation about? I’d quite like some cash.

Sooo – if you’ve started a finance arrangement which, unknown to you, included PPI or an inappropriate level of insurance, you can make a claim against the lender for mis-selling you the policy. And if your claim is successful, you get a refund. The average claim pays out 2 grand! TA DA!

“The amount set aside by banks, building societies and credit card firms is over £12bn”  Top fact courtesy of the BBC.

But who are the people calling me and texting me?? I’m pretty sure I haven’t taken out insurance!

These are claims management companies who offer to get you a PPI refund for a cut of about 20-30%. God, I hate cold callers, I need to get my number out of the phonebook. Unsubscribe to any mailing lists you don’t actually need. And ALWAYS click no to sharing your data.

But let’s cut to the chase – so you’ve taken out insurance – but how do you know if it’s been mis-sold?  If you can answer no to any of the questions below, you should definitely think about kicking some lender butt!

Even if you haven’t taken out PPI, now you know what it is, who’s ringing you and what you can do in the future! I.e HANG UP.




  • If the insurance was optional, was it made clear to you? 
  • Single premium PPI insurance normally only lasts for 5 years. If your loan/ finance agreement was for longer than this, did the adviser make it clear that the insurance would run out before you had finished paying for your loan?

  • Did the adviser try to persuade you to take it out by saying something like ‘we strongly recommend that you consider taking out PPI’? Anything like this which is clearly just an over-sell counts as an ‘advised’ sale. They should have explained demands and needs to evidence why this policy is suitable for you. If they didn’t, this is grounds for complaint and a nice little bit of compensation..

Published by ZBW

Zoe is a Forbes '30 under 30' finance pro, style writer, presenter and panellist, working for a fashion startup and trying to live that best life in the most IRL way possible.

2 thoughts on “WTF is PPI?

  1. Payment Protection Insurance is undoubtedly a worthy plan. It lends financial assistance when you need it the most. It pays for your outstanding loans, debts or mortgages, when your financial condition might not allow you to pay for them. Therefore it’s of immense help in case you lose your job or if you’re unable to work due to an accident or illness. However, the policy usually offers coverage for a specified time period, after which the outstanding repayments might have to be paid by the insured himself. There might be limitations on the benefit amount as well. And one other thing that has to be kept in mind is that, the coverage comes into effect after a specified waiting period only.

  2. By the way, if you DO think you have been missold PPI you can claim it back yourself, without having to speak to any dodgy companies. Money Supermarket even have a form to fill out and everything! I keep getting a mixture of these texts and 'you can claim money from that accident' texts which I find funny as I am so clumsy that I constantly get into accidents which are entirely my fault!

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