Top 5 Things to Pemember About Ppi
Payment protection insurance cover has received some bad press coverage over recent months, largely because a number of lenders and other finance companies have mis-sold this type of cover or added it to a finance deal without the borrowers knowledge. However, when sold appropriately this type of cover offers valuable peace of mind and protection to borrowers, protecting them financially against a range of circumstances.
Payment protection insurance cover, also known simply as PPI, is designed to cover repayments on your finance in the event that you are unable to earn and keep up with repayments due to redundancy, sickness, or accidents. The insurance will cover your repayments for a fixed period, and this type of cover is sold with all sorts of finance, from credit cards and store cards to secured and unsecured loans.
There are a number of things that you should remember about PPI. This includes:
1. PPI can prove valuable to those taking out finance, as it offers the peace of mind that if you are unable to work and make repayments for a certain period of time due to sickness, accidents, or being made redundant your payment will be covered. This means that you will not have to worry about your finances in terms of missing payments, and wonâ ™t risk your credit rating being affected.
2. Payment protection insurance is not compulsory, and you always have the option of taking out finance without this type of cover. Some lenders may try and portray you that cover must be taken, but this is not the case. You should always look at the benefits a PPI policy gives you, in order to make your own informed decision.
3. You do not have to take out PPI with your lender. Although PPI is not compulsory many borrowers do like to have the peace of mind that this cover offers. However, you should remember that the cost of PPI can vary and can be expensive with some lenders and providers. It is not a requirement for you to take this cover out with the lender that you are taking your finance through, and therefore you should make sure that you shop around to get the best deal and the best price.
4. PPI may not always be appropriate. In some cases PPI may not really suit your needs, and may be a waste of your money. For example, if you are self employed you may not benefit from the cover against missing repayments in the instance of redundancy.
5. Some lenders will offer you quotes on loans with PPI already added in, and as a result of this many people have ended up taking out PPI without even realizing it. Make sure that you check whether you have been quoted with or without PPI when you are looking into a loan or other form of finance.
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