Home Page
   Articles
       links
About Us    
Traders        
Recipes            
Latest Articles
Payment protection insurance

 
Post new topic   Reply to topic    Downsizer Forum Index -> Finance and Property
Author 
 Message
jema
Downsizer Moderator


Joined: 28 Oct 2004
Posts: 26603
Location: escaped from Swindon
PostPosted: Mon Jul 25, 05 2:44 pm    Post subject: Payment protection insurance  Reply with quote    

Radio4 just came up with some figures that are pretty extreme.

A staggering 5 Billion paid into these schemes in premiums yearly in the UK, and only 10% of that going out again in claims!

I always thought it was one hell of a scam, but I would never have guessed at how bad it was.

Jonnyboy



Joined: 29 Oct 2004
Posts: 23924
Location: under some rain.
PostPosted: Mon Jul 25, 05 2:46 pm    Post subject: Reply with quote    

Never got it, never will. It's always been a profit scam. You pay money to protect the lender from bad debt if your financial circumstances go tits up.

tawny owl



Joined: 29 Apr 2005
Posts: 563
Location: Hampshire
PostPosted: Mon Jul 25, 05 2:47 pm    Post subject: Re: Payment protection insurance Reply with quote    

jema wrote:
I always thought it was one hell of a scam, but I would never have guessed at how bad it was.


Totally. I get the Motley Fool newsletter, which is full of useful money-saving tips, and they have been totally scathing about these for years. They don't like extended warranties either - they reckon most appliances last far longer than shops make out (and having owned three sets of them, including a washing machine that lasted 13 years, I agree). I worked out once that I'd need at least three items to fail in the same year while still under the extended warranty to make them pay, and how likely is that??

sean
Downsizer Moderator


Joined: 28 Oct 2004
Posts: 41834
Location: North Devon
PostPosted: Mon Jul 25, 05 2:48 pm    Post subject: Reply with quote    

Indeed. Mortgage Indemnity Guarantee stuff was ludicrous as well.

jema
Downsizer Moderator


Joined: 28 Oct 2004
Posts: 26603
Location: escaped from Swindon
PostPosted: Mon Jul 25, 05 2:56 pm    Post subject: Reply with quote    

sean wrote:
Indeed. Mortgage Indemnity Guarantee stuff was ludicrous as well.


But on that one, you often had no option but to sign up

twoscoops



Joined: 28 Oct 2004
Posts: 1924
Location: Warwickshire
PostPosted: Mon Jul 25, 05 2:56 pm    Post subject: Reply with quote    

What a con. The bank asks you if you want protection (“the premiums work out at just 79p a week”) and then they add it up for the duration of the term, stick it on top of the loan you are taking out and then charge you interest for it.

ARRRGGHH!!!!!!

Treacodactyl
Downsizer Moderator


Joined: 28 Oct 2004
Posts: 25697
Location: Jumping on the bandwagon of opportunism
PostPosted: Mon Jul 25, 05 7:11 pm    Post subject: Reply with quote    

jema wrote:
sean wrote:
Indeed. Mortgage Indemnity Guarantee stuff was ludicrous as well.


But on that one, you often had no option but to sign up


I'm not sure if that's strictly legal. I know many lenders did do that but you may be able to complain to the FSA. I know I managed to get out of the MIG when I got a 95% mortgage ages ago, but then I was working for the lender at the time but they didn't like it.

sean
Downsizer Moderator


Joined: 28 Oct 2004
Posts: 41834
Location: North Devon
PostPosted: Mon Jul 25, 05 7:13 pm    Post subject: Reply with quote    

I think all the lenders have dropped it now.

jema
Downsizer Moderator


Joined: 28 Oct 2004
Posts: 26603
Location: escaped from Swindon
PostPosted: Mon Jul 25, 05 7:14 pm    Post subject: Reply with quote    

Does anyone in the insurance industry know the norms for premiums compared to payouts?

The 10% rate is self evidently a scummy rip off. But what about car insurance etc?

sean
Downsizer Moderator


Joined: 28 Oct 2004
Posts: 41834
Location: North Devon
PostPosted: Mon Jul 25, 05 7:45 pm    Post subject: Reply with quote    

I'd have assumed that was about average. Unless you need insurance (for a car or because you have a mortgage) you'll always end up ahead of the game by paying into a deposit account. The trouble is most of us aren't self-disciplined enough to do it that way.

Post new topic   Reply to topic    Downsizer Forum Index -> Finance and Property All times are GMT
Page 1 of 1
View Latest Posts View Latest Posts

 

Archive
Powered by php-BB © 2001, 2005 php-BB Group
Style by marsjupiter.com, released under GNU (GNU/GPL) license.
Copyright © 2004 marsjupiter.com