55,000 consumers get more time to complain about being mis-sold payment protection insurance (PPI)

The city watchdog, the Financial Services Authority (FSA), has extended the time available for consumers to go to the Financial Ombudsman Service (FOS) if their original complaint of mis-selling payment protection insurance (PPI) gets turned down.

This means that those people who previously had their claims rejected between 28 November 2009 and 28 April 2010 now have until 27 October 2010, another five months, in which to complain.

The move was taken by the FSA so that potential complainants would not be disadvantaged whilst it revamps the way firms are to deal with new PPI complaints.

PPI is a policy designed to cover the monthly payment if the policy holder becomes ill or is made redundant.

In May 2009 the Financial Services Authority (FSA) called on all firms to stop selling the insurance because of "ongoing concerns" with sales. Read more.

Single premium Payment Protection Insurance (PPI) will be banned officially from October 2010.

The mis-selling of PPI is currently the biggest source of unresolved problems in the financial services industry with the FOS claiming that the issue accounted for 30% of all the new complaints it dealt with in 2009-10.

In September 2009, the FOS changed its position and upped the pressure on PPI sellers and banks ordering them to reopen previously rejected complaints about mis-selling of the insurance. It estimates there could be about 500,000 cases. Firms were also ordered to improve the way they dealt with new complaints.

Following a review and consultation with PPI providers the FSA has had to delay its plan for new rules due to the many objections it had received, not just from the banks but many brokers and other firms selling the insurance. As a result an extension has been granted whilst the issue is being looked into further.

This time extension will enable those consumers that have had their complaint rejected as far back as November 2009 to go to the FOS if they want to take the matter further and claim back the premium paid.

FOS is a free service to the consumer but it will cost the bank or PPI seller at the centre of the complaint around £500 per case. This fee is paid to the FOS at the start of every FOS investigation, so in theory the bank or PPI provider loses this sum even before a decision is made on the case.

The regulator is aiming to have a new set of industry rules in place by the end of this summer. 

Do you feel you have been mis-sold PPI and don't know where to start?

If so then we have our very own easy to read questions and answers.

Letter 1 template to request your terms and agreement

Letter 2 template to demand a refund.

All free at the DebtWizard guide to Payment Protection Insurance (PPI).  

Related reading;

Thousands of consumers set to benefit from refused PPI complaints

Thousands of consumers are in line for compensation ranging from hundreds to several thousands of pounds each after the Financial Services Authority (FSA) ordered banks to re open 185,000 complaints dating back to July 2007 about redundancy and illness insurance, commonly known as Payment Protection Insurance, (PPI).

FSA orders Swinton to offer refunds on over 480,000 PPI policies

The Financial Services Authority (FSA) has fined Swinton Group Ltd, the high street insurance broker, £770,000 for serious failings in their advised sales of single premium payment protection insurance (PPI). 

Following discussions with the regulator, Swinton has also agreed to contact over 350,000 customers who paid for the PPI and offer a full refund.