Weighing the advantages and disadvantages of payment protection insurance

In principle, it makes a lot of sense to invest in payment protection insurance (PPI), a policy that is designed to protect your finances in the event of illness, injury, or job loss. However, people have become increasingly skeptical of the merits of this form of coverage since it became known that PPI was being sold clandestinely. Some people were persuaded to buy PPI when, in fact, they already had adequate protection. Others were wrongly persuaded that investing in this type of insurance was mandatory and not optional. But before you dismiss payment protection insurance as a policy nobody wants, it’s worth considering its merits.

First, it’s important to note that PPI can keep people from getting into serious debt in the event they are laid off or get sick. It has given many people peace of mind knowing that they are covered against monthly and yearly mortgage expenses should they experience such negative events. For those without protection, the prospects of housing recovery and the development of a bad credit rating are very real. Without PPI, they could plummet to unsightly levels of debt and have very little chance of getting much-needed loans in the future. Through absolutely no fault of their own, they could end up facing legal proceedings due to money owed.

It is those concerns that aggressive insurance salesmen took advantage of when trying to encourage customers to part with their money. Even retirees and the self-employed were told it was absolutely imperative to have payment protection insurance, even though their claims would be deemed ineligible. In an attempt to make as much money as possible, banks and financial institutions continued to sell policies to people who didn’t need them. We now have a scenario where the words, payment protection insurance, need to be spoken quietly. Newspapers continue to run stories about the highly negative aspects of this problem.

Although some people were happy to make a PPI investment, many more were so angry about the way they were treated that PPI claims seemed like the most appropriate course of action. If you fall into the latter category, then it might be worth discussing your options with industry experts at a reputable claims management company. They must provide information about the likelihood of success in your particular case and the amount of money you could see returned.