Plevin compensation is a term that has gained prominence in recent years due to the 2014 Supreme Court ruling on Plevin v Paragon Personal Finance Ltd. The decision changed the way financial institutions are required to disclose their commission and profit when selling payment protection insurance (PPI) policies to customers. As a result, many customers who were mis-sold PPI and did not previously receive compensation may be eligible for a new type of compensation known as Plevin compensation.
What is Plevin compensation?
Plevin compensation is a type of compensation that is awarded to customers who were mis-sold PPI policies but did not receive compensation through the standard PPI complaints process. It is based on the principle that if more than 50% of the total cost of the PPI policy was made up of commission payments to the lender and this was not disclosed at the time of sale, the customer was not fully informed and may have been mis-sold the policy.
The name “Plevin” comes from the case of Susan Plevin, who brought a legal case against Paragon Personal Finance Ltd after discovering that 71.8% of the cost of her PPI policy was made up of commission payments. The Supreme Court ruled that the non-disclosure of such a high level of commission constituted an unfair relationship between the lender and the customer, and therefore Paragon Personal Finance Ltd was required to pay Plevin compensation.
Who is eligible for Plevin compensation?
If you have previously made a PPI complaint and received compensation, you will not be eligible for Plevin compensation. However, if you have not previously made a PPI complaint or did not receive compensation for a PPI complaint, you may be eligible for Plevin compensation if the commission paid to the lender was over 50% of the total cost of your PPI policy and was not disclosed at the time of sale.
It is important to note that not all mis-sold PPI policies will qualify for Plevin compensation. The Financial Conduct Authority (FCA) has set out guidelines to determine eligibility, and each case will be assessed on an individual basis.
How can I make a Plevin compensation claim?
If you believe you may be eligible for Plevin compensation, you can make a claim through a reputable claims management company or by contacting the lender directly. It is important to be aware of potential scams and to only use a claims management company that is regulated by the FCA.
When making a Plevin compensation claim, you will need to provide evidence of your PPI policy and the commission paid to the lender. If you do not have this information, you can request it from the lender or the financial institution that sold you the policy.
It is important to note that there may be time limits on making a Plevin compensation claim. The FCA has set a deadline of 29 August 2019 for all PPI claims, including Plevin compensation claims. However, if you believe you have a valid claim, it is important to act as soon as possible to ensure you do not miss out on any potential compensation.
What is the process for Plevin compensation claims?
The process for Plevin compensation claims is similar to that of a standard PPI complaint. Once you have made a claim, the lender or financial institution will assess your case and provide a response. If your claim is successful, you will receive compensation that is calculated based on the level of commission paid and the interest charged on that commission.