Payment Protection Insurance (PPI)
Payment protection insurance (PPI) is sold alongside credit products, such as mortgages, loans and credit cards. It can offer valuable peace of mind to borrowers but many people have discovered, when attempting to claim, that PPI policies may not pay out. This guide explains how PPI works and whether you need payment protection insurance.
In theory, Payment Protection Insurance does what it says on the tin. It insures the repayments on most kinds of borrowing; including mortgages, credit cards, personal or secured loans or hire purchase agreements. However, PPI will only pay out if you cannot meet these repayments through no fault of your own - for example, if you lose your job or have to stop work as a result of an accident or illness.