Why is PPI controversial?
In 2011 a scandal broke about the PPI industry as many financial institutions had mis-sold it to customers, or implied that it was a necessary part of a bundle with their credit card or loan product. As a result billions have been paid out in compensation, giving PPI a bad reputation – however it can still be a useful product in the right circumstances.
What isn’t covered by PPI?
Before you take out payment protection insurance, keep in mind that your policy may not cover you in the following circumstances:
- For the duration of your deferral period, usually for the first week to 90 days
- If you contract certain illnesses – these will be listed in the policy documents
- If you have any pre-existing medical conditions
- If you’re retired
- If you’re unemployed
Will I be covered immediately?
Most insurers have a deferral period at the start of your policy, during which you can’t make a claim – this will normally last between a week and 90 days. Policies that don’t have this, or that have shorter deferral periods, are likely to be more expensive.
Will I be covered with a pre-existing condition?
Most insurers won’t cover claims relating to an illness you already have before taking out the policy, such as diabetes or a heart condition.
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