paymentPayment protection insurance can protect you in situations where you cannot make your monthly loan payments. It is constructed to cover you in case some an ailment or injury prevents you from making income and thereby causing you to fail to meet you debt payments. PPI has really been getting bad publicity in recent years due to a lot of mishandling and fraud from agents selling to PPI uneducated consumers. There have been different ways that these agents have scammed people into insurance policies they don’t need.

First of all you need to understand the terms of eligibility. You have to have a job when you sign up. Employment is a must, and you are excluded if you are self-employed, a student, disabled, or retired. There are other reasons for being denied PPI, so make sure to do your research. I say this because selling payment protection insurance to someone who is not even eligible for it is one way that agents have been scamming consumers. There are many claims made every year for people who are looking to get a refund for their payments on unneeded PPI.

When you take out a loan, you do not have to attach a PPI policy to it. This is the second way that you can be scammed. People have been told that they have to take out the insurance policy when procuring a loan, which is just not true. These loaners have told people falsely that they didn’t have a choice, or that their chances of getting the policy were good, even when they were not eligible! You do not have to have PPI! Other people realized too late that they had been paying for payment protection insurance and had not even discussed it when getting their loan.

This additional plan can add quite amount to the overall cost of the loan including interest on the cost of the PPI and has generated much fraudulent profit for banks and creditors. Once you have signed up for it, you have the right to cancel the plan. If you already had the plan for a while, you may face some cancellation fees. The catch is that if you were lied to while purchasing PPI, you can file a claim at and possibly get all of you previous payments refunded. You are supposed to be told everything up front about the insurance plan, not misled into purchasing, so you have a case for refund.

A third way that people can be misled into buying PPI is through sneaky language. Your lender may have used a different name for the insurance. You may not have been aware because you thought you were getting Credit Care, Income Protection, Mortgage Payment, Loan Protection, Accident and Sickness, or Unemployment insurance. By creating names that sound important but not telling you that you have the option of purchase, your bank or creditor can trick you into paying for this insurance.

Don’t get me wrong here, PPI can be a good thing if it is right for your situation, but there are thousands of claims from people who are victims of this scam. Protect yourself and do your research before signing anything!