The FINANCIAL — A large influx of payment protection insurance claims in the first quarter of 2012 has encouraged banks to shift the blame onto claims management companies in what Precision Claims believes to be a stunt to reduce the amount of help victims of mis-selling are receiving.
Precision Claims, which specialises in PPI Claims, believes the latest outburst from the chief executive of Lloyds Banking Group is simply an opportunity to reduce the amount of pressure on banks to pay up quickly.
Anontio Horta-Osorio criticised claims management companies for putting pressure on customers to take action even if they hadn’t been mis-sold PPI in the first place and says these ‘spurious claims’ are costing his bank money.
Last year banks paid out £1.9bn to victims of mis-sold PPI, however an estimated £5bn is yet to be paid out and this year’s ‘burst’ in claims has prompted financial institutions which were involved in the PPI scandal to set aside extra funds.
Precision Claims managing director Simon Thompson believes while some banks admit they work well with some claims management companies, others are encouraging customers to avoid them and providing false information.
“The banks involved in the PPI scandal are using a minority of cold-calling claim companies, who can take advantage of customers, to criticise the industry as a whole. We believe this is an attempt to shift the pressure away from themselves and have more control of how and when they decide to payout.
“Let’s not forget these banks are to blame for the billions of pounds which were stolen from innocent victims and have lost their trust as a result. Claims management companies do take a fee, however this is only if the customer succeeds in a claim and covers the hard work they put into every potential claim.
“While we believe it is fine for some customers to make their own claim, many victims may not even be aware they are entitled to any compensation, while others may choose to use a legitimate claims management company like ourselves as they retain a mistrust of the banks and want to ensure they are not short-changed.”
According to WebWire, Precision Claims are authorised by the Ministry of Justice and oblige to the strict conduct rules which state how claims management companies handle potential mis-sold PPI claims including no cold calling and a cooling off period of fourteen days.