Even though the deadline for making a complaint to your lender for having been ‘mis-sold’ PPI has now passed, it is possible for individuals to bring a claim against their lender due to a Supreme Court decision in 2017. This is because consumers were often not told that a large proportion of the money they were charged in PPI premiums were paid to the lenders by insurance companies in commission.
These claims are sometimes called ‘Plevin’ claims, after a case that was brought by Susan Plevin who had found out that nearly 72% of her PPI premium was paid to her lender in pure commission. She claimed she would never have taken the PPI policy out had she have known it would be so high, and therefore decided to bring her lender to court on the basis the amount of commission was unfair. The case went all the way to the Supreme Court, which agreed with Mrs Plevin and decided that secretly charging excessive commissions could render a relationship between a consumer and the lender unfair. That is the basis of our group claim.
As a result of Mrs Plevin’s case, the Financial Conduct Authority (‘FCA’) told all lenders to revisit certain consumers’ policies and refund any amount of commission charged on PPI policy that was over 50%. We dispute that this represents adequate compensation, but not all lenders made refunds even to this level. Consumers who have either not been compensated at all or who have only been partially compensated are therefore forced to issue legal proceedings to recover the commission, which can be costly and take a long time to conclude. A major downside to this is that all, or nearly all Plevin claims are heard by the County Court on an individual basis, even though all such cases are made on the same basis, raise similar points of law and share very similar fact patterns. The judges hearing the cases are not bound to follow any previous decision that another judge in a County Court has made in a similar case. This has resulted in inconsistencies in the way County Courts approach these types of claims.
The lenders’ response to this has been to take advantage of a lack of cohesion and to seek to ensure that claims made against them to recover PPI commissions charged are difficult, slow and expensive to pursue. This has often resulted in a number of claimants deciding to discontinue or settle their claim, resulting in little to no compensation at all.
We do not think that this is fair. We believe that by mounting a group claim against the key financial institutions to ensure they are held to account for the excessive commissions they charged thousands of consumers over the years we can provide a cohesive and cost-effective solution which will lead to better levels of compensation and a resolution for many more clients..