The payment protection insurance claims crisis has been a serious challenge for many banks throughout the country. A recent report shows that the crisis may starting to abate. The average number of PPI claims the Financial Ombudsman Service receives each week has dropped from 12,000 to 5,000. However, the PPI crisis is still a serious problem for these banks.
The FOS has been struggling to deal with a growing number of PPI claims. The organisation has retained additional claims handlers to help clear the growing backlog.
The FOS is relieved that the claims are starting to fall. Many staff have been overworked for the past few years as additional people continued to file PPI claims. Many consumers are also relieved by the news. A smaller volume of PPI claims will likely mean that consumers won’t need to wait nearly as long to have their claims processed.
The declining PPI claims is good news for consumers, the FOS and other groups that were inconvenienced by the backlog. However, the banks are unlikely to benefit as much from the trend.
While the volume of PPI claims has fallen, the average compensation of claims has increased. The banks are expected to continue to pay out large sums of money in the months to come.
The banks have collectively set aside about £20 billion to resolve the claims that have been filed so far. They recently announced that the funds they set aside are actually insufficient. They recently found that future PPI claims will be higher than they initially predicted and have needed to set aside an additional £1.5 billion to deal with them.
Also, the new trend isn’t enough to offset most of the costs that the banks are facing. PPI claims are still higher than they were in 2012. They could also start to increase again as many customers realize that they were mis-sold PPI policies. Most of the new claims were made by people that purchased PPI before 2005, which indicates that more customers may be realizing that they were mis-sold PPI many years earlier.
At this time we are continuing business as usual however our team will now largely be working from home. This limits our phone contact availability. Customer support remains available Monday to Friday but please email in to email@example.com with your query. We aim to get back to you within 48 hours. On receipt of PPI refunds our fees remain payable and can be paid via our website www.oraclelegal.co.uk/payments/ or via BACS. We are also working on some other areas of potential claim for you in connection with your PPI and will be in touch shortly where applicable to present this to you.