LLOYDS Banking Group has refunded thousands more PPI customers a share of £17,000, taking the total it has paid back to £975,000.
The latest refunds were issued to 8,800 customers after Lloyds – which also owns Halifax and Bank of Scotland – admitting sending incorrect information.
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The errors relate to admin errors in annual reminders to mortgage PPI customers dating back to 2013.
In some cases, the monthly amount policyholders could claim was displayed in the incorrect section in their reminder.
For other customers, the figure in their annual reminders was incorrect.
Lloyds admitted to the Competitions and Marketing Authority (CMA) that it breached the PPI Market Investigation Order 2011 three times in 2013.
What is payment protection insurance (PPI)?
HERE’S all you need to know about the mis-selling scandal.
PPI was an insurance policy attached to credit agreements such as loans, mortgages or credit cards.
The idea of these policies was to cover payments when a policyholder fell ill, had an accident or lost their job.
Sales of these policies were popular from the nineties and into the new millennium.
But then consumer groups started raising questions and a series of investigations revealed that lots of people had been sold policies when they shouldn’t have been.
One problem was that sales staff were incentivised to sell PPI at all costs, meaning lots of people ended up being mis-sold to.
Some consumers had policies sold in the small print that they weren’t aware of, others were sold insurance they would never be able to claim (for instance because they were self-employed or retired).
Sales of single-premium PPI policies were banned in 2009 and despite initial opposition, lenders were ordered to consider all PPI complaints in 2011.
As many as 64million PPI policies were sold, mostly between 1990 and 2010.
The PPI order requires banks to send customers annual reminders that set out clearly the cost of their policy.
It must also set out the type of cover customers have and remind them of their right to cancel.
In total, the banking group said it has broken the PPI order 18 times over eight years and had already paid back around £957,000.
It follows an investigation into Lloyds by the CMA in 2018, where the lender was also found to have failed to send annual PPI reviews altogether.
Lloyds Banking Group told The Sun that the payout is separate to the PPI misselling scandal, the deadline of which passed in August 2019.
Anyone who was due a refund from the latest payout should have been paid in 2020, with each person receiving around £2 each back from the bank.
Lloyds Banking Group has around 29million customers across all its brands in the UK.
A spokesperson said: “We’re really sorry that due to a historical issue, a very small number of customers did not receive the correct information in their annual PPI statement.
“Customers have paid the right premiums and there is no financial impact, but where appropriate we have proactively written to customers to apologise and provide the correct information.”
Adam Land, senior director of remedies, business and financial analysis at the CMA, said: “It’s a real concern that PPI providers are still breaking the rules by sending inaccurate PPI reminders despite a clear, well-established Order from the CMA.
“These failures can mean people end up paying for insurance they no longer need.
“We welcome the fact that Lloyds’ has refunded – or committed to refund – customers £975,000 and we will monitor the bank closely to make sure those affected by the latest breaches receive the refunds.”
What is PPI?
PPI was an insurance policy attached to credit agreements such as loans, mortgages or credit cards.
The idea of these policies was to cover payments when a policyholder fell ill, had an accident or lost their job.
But concerns were raised by consumer groups that this insurance was sold to people when it shouldn’t have been.
The deadline for claiming back missold PPI was in August 2019.
Generally, if you didn’t make a complaint by this date, you can no longer ask the Financial Ombudsman Service to investigate.
More than £38billion has already been paid back to people who complained about the sale of PPI, according to the Financial Conduct Authority (FCA).
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Legal experts last year claimed that millions more people could get new PPI payouts following a series of court rulings that found some customers had been kept in the dark about commission fees.
The courts found some customers had been kept in the dark about commission fees paid to the banks by insurers.
You won’t be able to make a claim if you’ve already received a full refund from your PPI policy.
Martin Lewis reveals how your bank could owe you £100
