Evidence Check List for PPI Claims
For a superficial overview of PPI mis-selling litigation please follow
this link.
Claims for mis-sold PPI require careful preparation. It is a very
technical area. A major strategy adopted by banks and finance houses in
defeating such claims is attach on pleadings.
The following information will help in any PPI claim. It should be
information which was current at the date the PPI was sold.
This is deliberately not made into a questionnaire to give to the
client to tick boxes. It is intended as a guide to a legally qualified
person interviewing a client to take an accurate proof of evidence which
will inform both solicitors and counsel just what the client will say when
closely questioned (as they will be) at court.
About the Insured
Full name of Insured
DoB
Employment (Job title and salary)
How long has the Insured been with the then current
employer?
How safe was the job at the time – any knowledge of
impeding redundancy risk etc?
What sickness benefits would the Insured receive form
his/her employment – amount and length?
Retirement date (if relevant)?
Any insurance provided by employers e.g. life insurance?
Were circumstances known at the time the loan was taken
out to be likely to change in the middle of the loan e.g. by
retirement or by marriage or by imminent child birth or any
other reason?
Other Insurances (e.g. life insurances or other PPI on earlier
agreements being consolidated or other PPI taken out not specific debt
related).
Other ways to pay off the debt in the event of unemployment -
e.g. savings, equity in property, insurance policies which could be
cashed in, assets which could be sold, family borrowing.
Joint Loans – same details as above in respect of other joint
borrower.
Loan History – does Insured have a history of settling loans early? –
details. Would the lender be aware of that history? (this can be
relevant to issues of requirement for flexibility – which is part of
overall suitability of single premium PPI).
Purpose of the loan. State the purpose of the loan. If consolidation
is the purpose please state whether purpose was to reduce overall
outgoings and spread them over a longer period to make them more
manageable. If so an expensive PPI add on will not be suitable. Proof
that cost was relevant to the customer's demands and
needs is crucially significant and this point should
never be overlooked.
Did the Insured want to purchase PPI when they decided to apply for
the loan. Was it on their shopping list?
About the Insurance Sales
Person (The Intermediary)
Was it an independent broker or an employee of the lender – very important issue
- take care with this especially where the agreement is not regulated so
that S.56 CCA is not available.
If it was a broker state full name and address and say where the
interview took place. Then check that broker is still solvent and
trading.
If it was an employee state full name and address of where the
interview took place.
What did the broker tell the Insured (if anything) about the range of
products from which he/she was choosing?
About the Lender's Sales System
Before getting into what was said state the order in which things
happened. E.G. it often starts with an interview by phone or face to
face in which the important decisions are taken. There then follows
delivery of an agreement for signature often accompanied by more bumph.
The order of event is most important. E.G. information given before the
deal is done in the interview is much more valuable to an Insured than a
pile of tedious looking information dumped on him with the agreement
when he thinks the agreement is a done deal. Please work though
the order of events carefully and set it out at this stage in the proof
- much of the rest is put in context by this information.
About the Interview
If it was by phone ask for recording and/or transcript of the
interview. If there is none ask for a copy of any scripts which the
intermediary was following. Who called whom? Was it a cold call?
If it was face to face where did it occur? Did the Insured visit the
place for the purpose of obtaining PPI or not. Did the Insured visit the
place for the purpose of a loan or was it sold to them while they were
there on other business.
Loans not at business premises: When a loan was made e.g. at an
airport or motorway service area or an event get all the relevant
information as to date place etc and how the sale was made.
About the selling of PPI in
principle
How and when was PPI first introduced into the interview? Distinguish
carefully between the following cases and indicated with applies (it may
be more than one but make sure they are not mutually exclusive):
The PPI was added without the Insured’s knowledge or
understanding so that the Insured simply did not know he was
signing up to PPI;
The Insured was told that PPI was a requirement of being
given the loan;
The Insured was led to believe that PPI would assist the
prospects of the loan being granted;
The Insured was pressured into buying PPI by sales
insistence falling short of being told that if it was not
purchased the loan would not or may not be granted;
The Insured had PPI recommended and just followed the
recommendation;
The Insured stated that he/she did not want PPI but was
given it anyway.
About the Recommendation
This concerns not the fact that PPI was made a requirement
etc but the particular PPI policy which was taken out. Did the
Insured choose the policy from among a number offered to
him/her/
Did the Insured know the identity of the Insurer when the PPI
was being sold to him/her?
Was the Insured aware of having any choice in the matter?
About the Cost of the PPI
Was the Insured made aware that he/she was pre-paying for
insurance cover and paying interest for the whole of the loan
payment on that premium and that if he preferred he could
purchase monthly without prepayment or interest payment?
Was the Insured shown the total cost of the loan with and
without PPI added and invited to choose which one he preferred
to take?
Was the Insured informed that the interest on the single
premium PPI was payable throughout the term of the loan even
though the insurance may expire before the term of the loan?
What is the maximum about payable under the PPI for an
unemployment claim (usually 12 months instalments)? How does
that compare with the total costs of the PPI (the premium and
total amount of interest on the premium combined). Was that
drawn to the attention of the Insured?
Was the Insured told that if no claim was made on the policy
the cost of the PPI would be returned? If so were they told tat
the interest they had paid on the premium would not be returned?
About the Suitability of the
PPI
Was the Insured asked about his/her employment history? What
was the conversation?
Was the Insured asked about his/her health history? What was
the conversation?
Was monthly PPI mentioned as a possibility on the grounds it
would be more flexible if the loan was to be ended early?
Was the Insured told that he could purchase PPI elsewhere if
he wished?
Was the Insured told that the PPI may not last the full
length of the loan term?
Was the Insured told that if the PPI was cancelled the rebate
on unused policy time would not be pro rata with the time?
Joint borrowers:
Was each Insured told that the PPI would cover
only one of the joint Insured even though both were
paying for it?
Was the most advantageous party Insured?
Was the non-covered party told that they would
have no cover despite paying for the PPI
Was the Insured warned that they had to read the bumph which
arrived with the agreement to check that what they had been told
in interview was true or that the bumph may be at variance with
what was said in interview?
Was the Insured told that they could alter the agreement sent
to them to omit PPI if they so wished?
Was the Insured advised about the exclusions on the PPI
policy? If so, was the Insured taken though them to see whether
they applied to him/her?
Was the Insured informed about any commissions being paid by
the supplier of the PPI policy?
Was the Insured informed of any business connection between
the provider of the PPI policy and the provider of the loan?
Was the Insured informed about any commission that would be
paid by the insurer to the person who introduced the claimant to
the Insurance Company? If so what was he told?
Was the Insured given any written information in the
interview about the PPI before he signed the agreement?
Does the Insured remember singing any other forms apart form
the loan agreement at the time? If so what did he sign?
The Form of Credit Agreement
When the agreement was sent for signature was the space where it
should be signed marked out with crosses or in some other way so that
the agreement could be easily signed without the need to read the
agreement? Ask for a copy in advanced disclosure – make sure that all T
&C are supplied and that all of the agreement and T & C are easily
legible.
Was the form of agreement pre-prepared with PPI in a way such that it
was impossible or not easy to select the loan without PPI added?
Was the Insured informed that they could return the agreement if they
wished and have it modified to exclude PPI?
In the interview did the Intermediary rush through various parts of
it – e.g. rushing though a part of a script and then asking whether the
Insured understood it all at the end? If that happened did the Insured
say they did? Was that because they did take it all in or just for
politeness sake?
Accompanying Bumph
Was the Insured provided with a copy statement of demands and needs?
Ask for a copy in advance disclosure.
If so did this reflect the Insured’s true demands and needs? In which
was it wrong either by inclusion of the irrelevant or incorrect or
omission of the relevant?
Was the Insured provided with a copy of the PPI policy or a policy
summary before the agreement was executed? – ask for a copy in advanced
disclosure.
Was the Insured asked to sign other sale documentation apart from the
loan agreement? If so:
Did they know what they were signing?
Did they get the chance to read the document in full
before they signed it?
Did the Insured realise that what was contained in the bumph may be
significantly at variance from what they were told verbally by the
intermediary at interview and that they should check through the bumph
to make sure that what they were told by the intermediary in oral
discussion was accurate and true?
Churning
Look out for cases where there has been a succession of credit
agreements, often for consolidation purposes where PPI has
been mis-sold every time and unfair rebate calculations have resulted in
the clients paying for unused PPI unnecessarily.
In such cases, if there is no limitation problem, please do not send
instructions until you have obtained
copies of all agreements, all PPI policies and the financial statements
of account in connection with all agreements so that the rebates on both
early termination loans and PPI policies may be scrutinised.
Copyright John Pugh 2010
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