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Why Is Regulation so Important with PPI Claims Companies?

The recent payment protection insurance (PPI) scandal has resulted in millions of people in the UK losing billions of pounds of their hard-earned money. The majority of consumers have already filed their claim and received compensation, and more than £20 billion has been paid out by banks and lenders across the UK.

Claims management companies are helping the UK public get back the money that is rightfully theirs. Even though they might initially seem like the good samaritans, there are definitely a few “rogue” companies in the industry. Throughout the next few sections we’re going to talk about the importance of regulation.

The Importance of Regulation

Regulation is extremely important when it comes to claims management—this is especially true considering the recent PPI scandal. A significant amount of “rogue” companies have emerged in this industry and this has resulted in consumers paying upfront fees, receiving poor service, and being swindled once again by the very companies they should be able to trust.

Regulated companies have to operate to certain standards, but what about companies that are not regulated? Well, as you would expect these companies don’t have to adhere to these standards and so you are more at risk of being swindled or having a bad experience.

How Regulation is Carried out in the UK

Claims management companies are regulated by the Ministry of Justice (MOJ). They even have their own department specifically for claims management companies, which is known as the Claims Management Regulator (CMR).

In addition to being regulated by the MOJ, claims companies should also be a member of a professional body such as the following: the Law Society of England and Wales, the Law Society of Scotland, or the Law Society of Northern Ireland.

How You Can Make Sure You’re Choosing a Regulated Company

Before you do any dealings with a claims company, you should always do a quick check to ensure that they are properly regulated. This check won’t take anymore than a few minutes and can be done by visiting the following website: https://www.gov.uk/check-claims-company-registered

You can conduct your search through various methods: authorisation number, business name, or trading name.

Complaining about a Claims Company

As you can see, the claims management industry is quite heavily-regulated and so you can expect a strict complaints procedure to be in place. You might be tempted to go immediately to the FOS, but this isn’t the best course of action.

Here’s what you should do if you are unhappy about the service you have received from a claims management company:

1. First, contact the claims company and ask for a copy of their complaints procedure.
2. Send a formal complaint to the company and give them a chance to resolve the situation.
3. The company has eight weeks to resolve the situation. You can take your case to the FOS if the company doesn’t respond to your complaint within eight weeks, or if you are unhappy with the response that you receive.
4. Make sure to document any communication that happens between yourself and the company throughout this time.
5. Fill out the complaint form and the questionnaire on the FOS website, then contact them and send over these documents.