Fast Turnaround Response For PPI Claim...Something Is Not Right!

[Bill-K]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

I've made another calculation based on the following:
The PPI premium of £29.99 was added to the total cost of insurance at the beginning of each year.
A credit agreement was created each year for the total cost of insurance & PPI, to which interest was added at an APR of 35.4%.
The Total Amount Payable under the agreement (ie., Car Insurance, PPI & loan interest) was divided into 12 monthly payments.

This gives £119.96 in PPI premiums (as mentioned already);
Loan interest on these premiums at 35.4% APR of £10.62 per year - totalling £46.22;
Compensatory interest at 8% (simple interest) on the above totalling £172.41 (as at 19/08/13).

This totals £334.84 (as at 19/08/13) - and it now considerably increases the claim size !

[Helpseeker]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Hello Bill,

I note that you were up late this morning, so thanks very much for your further responses.
That really helps a lot, especially with my understanding of the calculations.

With the inclusion of the interest, it gets a little bit confusing.
Just to confirm, the payments were renewed each year as part of a payment plan spanning 12 months.

~~~~~~~~~~~~~~~~~~

Information 1

In the KF renewal letter dated 15th Oct 1999 for the 5th Nov 1999 renewal, it shows the following:

Insurance Premium £691.71
*First instalment £72.09
*11 further instalments of £68.57
*Total amount payable (35.4% APR) £826.36

On the reverse page at the bottom in small writing are the words *The instalment amounts shown include the renewal of your Payment Protection Plan.
In even smaller writing at the very bottom it states Premiums shown are inclusive of Insurance Tax at the current rate. The current rate was 35.4% .
_____

Information 2

In another related letter dated 5th Nov 1999 for the renewal, it shows the following:

"Under the Confirmation of details:

* Insurance premium
(including insurance premium tax) £691.71
* 1st Installment (no interest charged) £69.17
* Balance of insurance premium £622.54

ADD
* Installment Charge £99.61

Total Amount Payable £722.15

Subsequent Instalment Amounts £65.65

First payment date is 02/12/99. Subsequent payments being the 2nd of each month."

On the Motor Policy Schedule, there is a box called "Additional Premium" with an amount £691.71 in the box.
It also states "Additional premium is inclusive of Administrative Fee". The admin fee amount is not stated.
____

Information 3

In another letter dated 09/11/01 it states ~ This is a letter confirming the renewal of the policy.
It shows the monthly installments due from 8/12/01 for £84.04 , and 8/01/02 to 8/11/02 for £78.37 (monthly lump sum figures, ppi is not shown as a seperate fee).

~~~~~~~~~~~~~~~~~~

If required and if it will be of help, I will try and see if I can post up the information.
On Thurs 15th Aug, here is my response sent to KF about the cheque I received:

"Thank you for your letter dated 12th August 2013 enclosing a cheque #????? in the sum of £129.56 .

I write to advise that I am very surprised to receive this cheque.

We had not yet completed negotiations regarding the amount to be reimbursed to me, neither had I signed any statement in full and final settlement of my claim for mis-sold PPI, with your company.

I would be grateful if you would please send me a more detailed breakdown of how you came to the figure of the PPI refund, together with any other charges added to my account, during my years of paying for car insurance with your company.

Thanks in advance."
_____

Yesterday I received a response to my query (above) from KF, which I will post below. From what I gather, in one part of her reply, it seems like she is trying to wave off the extra 8% compound interest that is/could be applicable to my request.

Quote from KF ".....I can confirm that you were not charged any interest for the payment protection policies on your monthly direct debits."

My question is: how can she confirm this if she doesn't/is not meant to have access to information dated back 11-15 years ago?
Just to let you know that I still have the cheque in my possession (although I am tempted to bank it).

The full email response from KF is below:

" Thank you for your email. I am sorry you remain unhappy.

As confirmed in my previous email, I regret that we are unable to access your insurance policies from 1998 to 2002.

The refund of £129.56 was based on you having a payment protection policy between 1998 and 2002 with the additional 8% interest as shown below. The cost of the payment protection policy started at £19.99 and was increased to £32.89 in the later years. However, we have based the premium at £29.99 as a gesture of goodwill.

1998 to 1999 - £29.99
1999 to 2000 - £29.99
2000 to 2001 - £29.99
2001 to 2002 - £29.99

Total cost of payment protection policies is £119.96 plus 8% interest £9.60 = £129.56. I can confirm that you were not charged any interest for the payment protection policies on your monthly direct debits.

I regret that I have fully investigated this matter thoroughly and based on the information that you have sent to us, your refund of £129.56 was processed. Unfortunately, my previous decision remains unchanged.

If you require any further assistance, please contact me on 0800 519 1300 or by return email. I am normally available from 9am until 5pm, Monday to Thursday.

Kind regards"



I'm not sure what to do next?

Is it still worth sending the SAR letter? Would that be a waste of £10?
Do I respond to her and cc in her Supervisor, so that someone else at KF knows about my continual queries?
Do I contact the FOS or another authority?

Regards,
HS.

[Bill-K]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Thanks for posting the further info, HS. Although KwikFit say that there was no interest charged on the PPI premiums, their letters suggest otherwise. Sure - the initial monthly payment may not have had interest charged on it, as it is usually treated as a 'deposit,' but because the PPI has been included in the total insurance premium, then we must assume that it attracted interest along with the car insurance premium. I suspect that they know this, but cannot be @r$ed to work it out themselves, so they have worked on the basis that the premium is taken as £29.99 (as a 'gesture of goodwill') in order to cover themselves.

What we must do is base our calculation on the £19.99 premium, as this is what our basic expectation should be. I have used your first information point as the basis for calculation this time. If Kwikfit disagree, then they must explain why, and produce their evidence. So...
We have a car ins. premium of £671.72 plus PPI of £19.99, giving a total premium of 691.71, as per the quote/letter.
To this, £134.65 in interest is added, bringing the Total Amount Payable (TAP) for that year to £826.36, as per the quote/letter.
The £19.99 PPI portion of the premium is 2.8899% of the total premium of £691.71.
So, 2.89% of the £826.36 charged is attributable to the PPI premium, and that comes to £23.86.
Finally, the Compensatory (NOT compound) interest is added to each monthly payment at the rate of 8% p.a. (simple interest) up to the date of settlement (which I have taken as 20/08/13 for this calculation). This is a more complex calculation, but it is basically calculated from the date of each payment to the settlement date, so it slowly decreases throughout the calculation period.

I have attached 4 spreadsheets to show this, and I hope this all helps with your understanding of the calculations. What we now have is a total claim 'quantum' of £182.91 - which is still £53.32 more than the £129.59 offered, but not as much as my earlier calculation based on the £29.99 premium 'goodwill' calculation. It doesn't seem worth spending £10 on a DSAR for, IMHO, and I think it may well be enough to just send them copies of the spreadsheets to show how you have calculated your claim. Likewise with the FOS - the amount of time and effort involved hardly justifies the extra £50 - but I would certainly say that it's worth a few more letters/emails to Kwikfit.

[Helpseeker]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Hello Bill,

You are so good! :clap2:
Thank you so much for supplying the information and detailed calculations.

I am just looking at them to get my head around each entry, as that way it will help in my making a quality/detailed response to her last email.

I will reply back to KF with this new information, incl spreadsheets and note their response. Hopefully they will review their decision and amend accordingly with the calculated increase.

I will also include the initial Customer Services Supervisor as a 'cc' in my response.
Even though the refund was authorised (there are two signatures on the cheque), I'm not sure whether she knows about the previous emails and their contents.

Thanks again and I will keep you posted!

Regards,
HS.

[Helpseeker]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Hello,

After sending an email with the spreadsheet attachments, I 'cc' the supervisor as well as the main contact.
I received a response from KF customer services and they are sticking to their decision about the ppi refund.

See info here:

Good Afternoon

Thank you for your email and the information you have provided.

I would like to assure you that we did not add any interest charges to the payment protection plan while this cover was on your monthly direct debit plans. You would have been charged interest for your insurance premium.

On your documents we confirmed that the premiums shown are inclusive of insurance tax. Insurance Tax is different to the interest charge and again this tax is only added to your actual insurance premium and not the cost of payment protection plan.

I regret that the refund of £xxx.xx remains unchanged and our final decision has been issued on this matter.

I understand this is not the outcome your were expecting and I hope that my explanation has been helpful to you.


What's my next course of action?
Do I bank my refund?

Regards,
HS.

[Bill-K]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

It is quite possible that the PPI was charged as a monthly premium and did not attract interest, HS - but as you say, they have admitted that they do not have this information. It is possible that they could show that the 'general practice' at that time was not to charge interest on PPI premiums, and therefore this would probably have been the case here - but they have not said this.

Their renewal letter of 15/10/99 seems to make it clear that the PPI premium was 'rolled up' into the total insurance premium, and therefore attracted interest. They have already admitted that they have nothing to refute this, and I would suggest that you point this out to them. It may be worth mentioning that a referral to the FOS will probably cost them a lot more than the extra fifty-odd quid they are quibbling about, too.

As regards insurance tax, this is a totally separate charge from the credit interest charge, and is NOT charged as an APR. In a way, you can view it as being similar to VAT. I suspect that this may have confused you.

[Helpseeker]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Hi Bill,

Thanks for your response.

Could you possibly help me to draft a response to them?
I'm happy to use my own words as long as the finer points of what needs to be said, is stated.
I'm really thinking about including the CEO in the email, if I can find his/her email address.

Also, you mentioned about the FOS.
Isn't it free to utilise their service?

Regards,

[Bill-K]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

I think you basically need to refer to their admission:

"As confirmed in my email dated 5 August 2013, I regret that we no longer have access to your files from 1998 to 2002. However, as you have provided some documentation from these years, I have been able to make a decision in relation to your payment protection claim.

Following my investigation, I can only assume that the payment protection policy was in force for your four policies from November 1998 until November 2002. I am unable to listen to the call recording from when the payment protection policy was added to your monthly payments and cannot confirm that this policy was mis-sold."

They clearly have NO evidence to show that mis-selling didn't take place, and the ONLY evidence they have is what you have provided to them. This evidence clearly indicates that the PPI and the Car Insurance premiums were 'rolled together,' and charged as a total package. Interest was clearly charged on this package, and therefore was charged on the PPI element of it. There is NO evidence to suggest that this was not so.

This is the result I got from googling - you may get more info if you do the same:-
http://investing.businessweek.com/re...roup%20Limited

The FOS is free for you and I to use, but they charge the lenders whom they are required to investigate on our behalf. Whether the claim is upheld or not, they can charge the lenders around £1,000 to £2,000 (last time I checked) for EACH claim they have to look into.

[Helpseeker]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Hi Bill,

Thanks very much for this.
I will get back to them using this information.

Warmest,
HS.

[Helpseeker]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Hi Bill,

I hope you had a great Bank Holiday weekend.

A question came to mind that I've been wondering about.

With my situation, does that mean that I have one claim that could be looked into,
or four because of my initial purchase and further renewals i.e. 4 years in total.

So from the information shared and with the charges the FOS make to look into each claim,
they could charge £1,000 - £2,000 or £4,000 - £8,000 ?

Regards,
HS.

[Bill-K]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Good point, HS - but I suspect it will be treated as one single claim, as they are bound by the FSA/FCA rules which state that all other associated claims must be considered at the same time. I DO dig your nifty logic, though !!!

[Helpseeker]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Hi Bill,

Thank you, it was just a quick thought.
If KF make inflexible decisions that guide them down that particular path, then so be it :der:

After looking over all of the recent correspondence, and noting the quality advice given here on LB, it really made me notice the 'tone' in the customer service reps latest response.

No more faffing about with a puppet, so I decided to go straight to the puppet-master.....the FOS. After looking through their guidelines on how businesses should operate, I also saw where KF fell down in their handling process of my ppi complaint.

The rep. at the FOS was very polite and showed compassion when I aired my concern about the way my complaint was handled. They made some notes and will send some information to me. It was mentioned that there was a timeframe, i.e. 12-18months for my case to be investigated. That seemed almost secondary, as at least my complaint will be in their system ready to be reviewed.

I will note update(s) here as and when.

Regards,
HS.

[Bill-K]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Fair enough, HS - you have given them every opportunity to deal with you fairly - so I guess the FOS should now be the next move, but it does often take 12-18 months for the FOS to resolve. You may already know that the FOS uses the rules set out by the FSA (now FCA), and you might want to read up on some of these during this time. The general conduct and dispute resolution rules are available on the FCA website here:

http://www.fca.org.uk/static/documen...redress136.pdf

The PPI rules (DISP APP 3) are shown in Appendices 1 & 2 of PS 10/12:

http://www.fsa.gov.uk/pubs/policy/ps10_12.pdf

[Helpseeker]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Brilliant, thank you :thumb:

[Helpseeker]

Re: Fast Turnaround Response For PPI Claim...Something Is Not Right!

Hello All,

I just wanted to give you an update on my situation.

After sending off my complaint to the FOS I received the response of which the main extract is "...it looks like we can't consider your complaint against the business that sold you the PPI. This is because your PPI policy was sold to you before 14th January 2005 - the date when all businesses selling insurance became regulated and had to follow specific rules on how they sold insurance".


Their full response is below:

"Thank you for contacting us about your payment protection insurance (PPI) policy.

Your Complaint

The Financial Ombudsman Service can look into a wide range of complaints about financial products and services. But there are some rules and limits on where we can help.

Based on the information you have provided it looks like we can't consider your complaint against the business that sold you the PPI. This is because your PPI policy was sold to you before 14th January 2005 - the date when all businesses selling insurance became regulated and had to follow specific rules on how they sold insurance.

What You Can Do Now

There are some circumstances where we are able to consider complaints where policies were sold before 14 January 2005 - for example, where a bank or building society was responsible for the sale. If you think the business selling your policy could have been acting on behalf of another business, you could try getting in touch with that other business about your complaint.

If you are not happy with the response you receive, you can contact us again and we will look into whether we can help.

I am sorry that we've not been able to help you further on this occasion.

Yours sincerely.

[signature]
[printed name]
Adjudicator. "


Personally, the biggest question that comes to mind is that KF made an initial ppi re-payment based on my initial query.
So how is it that the FOS have not fully recognised or even mentioned this, and have mainly based their reply on time limit(s) as opposed to KF's redress? To me, it doesn't make sense.

What are your thoughts?

Regards,
HS.