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Liverpool
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Specialists in consumer credit and commercial debt litigation

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John Pugh LLB (Hons)
Barrister

Eileen Ashton JP LLB (Hons)
Practice Manager

Suzanne Thomas
Administrator

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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