| Banks, PPI Refund, PPI Scandal

The ‘Plevin’ verdict has resulted in widespread ramifications in the PPI scandal. Banks have been forced to give away compensations to the tune of thousands of pounds to claimants for simply having a PPI policy.

The ‘Plevin Rule’ came into effect on the 29th of August, 2017. And as a result, all the commercial banks have been obliged to follow the new rule while dealing with PPI cases.

Banks were also forced to compensate claimants in cases where the lenders earned high commissions from the PPI policy sold. There have also been several cases where people have earned a four-figure sum of money due to the Plevin rule, in spite of their claims being rejected by the same lenders in the past!

The Plevin rule has turned out to be a game changer when it comes to the regulations made in the interest of the consumers.



How The Plevin Ruling Came About

The Plevin rule gets its name from a famous 2014 court case where a lady named Susan Plevin claimed that she was kept in the dark about the huge amount of commission charged to her through the PPI policy sold to her by the provider.

In the end, the court ruled in her favour. They found that the provider had charged a whopping 71% commission on the sold policy without disclosing the figures to the claimant.

Moreover, it was concluded that almost all the commercial banks involved in the selling of PPI policies used to receive the majority of the policy’s costs in terms of commission. This made it evident how poor the policy was in terms of its value in the market.

This ultimately led to the Plevin ruling, which states that if a PPI customer was charged more than 50% of the policy’s cost as commission to the lender or the lending institution, and if they were not informed about the same, they are supposed to be paid the extra amount along with added interest by the provider.



Implications Of The Plevin Rule

Furthermore, it was discovered that the banks were paid more than 67% commission on average for a PPI policy. On a loan worth £10,000 taken for a period of five years, the Plevin compensation is estimated to be about £500 or even more.

This implies that there are millions of customers who still stand to win extra compensation for their PPI policy. All you need to do is check if you have a PPI policy and then determine the ratio between the cost and commission of the policy.

A drawback here is that it would be hard for a claimant to determine the exact amount they are owed in refund, as the commissions were never disclosed by the banks. However, looking at the statistics of commissions charged on average for a PPI policy, it is always worth taking a shot.

In order to qualify for a refund, it is important that you have your PPI policy along with any loan scheme active around the month of April 2008 or later. If you have had a policy active before April 2008, you may not be able to take advantage of the Plevin Rule.



Plevin Refund-Case Study

Alison Baker is reported to be one of the first claimants receiving compensation through the Plevin Rule. Hailing from Bradford, West Yorkshire, she was awarded a sum of £1,175 from her lender after making a claim. She had submitted two complaints along with her husband in 2011. One complaint was made against Capital One credit card Company, and the other for a Nationwide mortgage. Both the complaints were rejected even after the claim was taken to the Ombudsman for a trial.

Alison and her husband had lost all hope on getting their compensation back. However, when Alison read about the new Plevin rule, she decided to file another complaint for PPI compensation.

She filed another complaint for both the products in September 2017, and was compensated under the Plevin ruling by Capital One within two weeks! On being asked about this sudden turn of events, Alison admitted being extremely tired about all the rejections she’s had to face for a long time. She was also pretty uncertain about making the claim again as she did have high hopes about being successful this time around.

Alison received a cheque for the credit card pertaining to Capital One PPI policy that was issued to her in 2006. She is still waiting on updates regarding the mortgage on the same, which means that she could be due even more in compensation.



Other Success Stories Of The Plevin Ruling

Alison is not alone when it comes to claiming refunds pertaining to the Plevin rule. There have been several other success stories since, which further goes on to illustrate that the Plevin ruling has certainly benefited the customers in several ways.

Grahame Burt, aged 60 from Harlow, Essex, was compensated £1,375 after two of his claims were rejected by the Tesco bank credit card division. Similar to Alison, Grahame had lost all hopes about ever getting his refund, which later gave way to relief after reading about Plevin online.

Apart from the customers being refunded in four figure sums, several other customers have been the recipients of smaller compensations holding the same amount of significance.

27 year old Tom Dipple from Hayling Island, Hampshire, was awarded a compensation of £320 through the Plevin ruling. Tom was mis-sold the policy in 2007 when he purchased a credit card with Capital One.

The FCA’s new ruling has certainly come to the aid of many mis-sold PPI customers. It has given rise to new hope among many previously rejected claimants about claiming PPI compensation amounts rightfully owed to them.

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