Most people assume the PPI story is over. The UK’s August 2019 FCA deadline passed, the banks paid out, and everyone moved on. That assumption is costing consumers real money. A PPI payment protection insurance settlement is still achievable in 2026, and in some cases, the mis-selling is still happening right now, just under a different name and product type. This guide explains what PPI was, why the problem never fully went away, how car finance commission abuse mirrors the same pattern, and exactly how to reclaim what you’re owed.
What Is PPI and Why Mis-Selling Is Still a Live Issue in 2026
How Payment Protection Insurance Was Supposed to Work
Payment protection insurance was sold alongside credit products, loans, credit cards, mortgages, store cards, and car finance agreements. The policy was meant to cover your repayments if you lost your job, fell ill, or became unable to work. In principle, that’s a reasonable product. In practice, banks and brokers turned it into a revenue machine.
Lenders bundled PPI into agreements without clearly telling borrowers it was optional. Some policies were sold to people who were self-employed or had pre-existing conditions, groups who could never have claimed on the policy anyway. Others were added without any consent at all. The FCA handled over 64 million PPI complaints between 2011 and its August 2019 deadline, making it the largest consumer redress exercise in British financial history, with banks paying out more than £38 billion in refunds.
That scale tells you this wasn’t a fringe problem. It was systemic.
Were You Sold PPI Insurance Without Knowing It?
This is the core question, and the answer is often yes, without the borrower realising it. Readers who come to Finances Claims with questions about reclaiming PPI frequently report the same barrier: they had no idea they held a policy in the first place. The charge appeared as a small monthly addition buried in their statement, sometimes labelled as “loan protection,” “payment cover,” or “credit insurance” rather than PPI.
Check any credit agreements, loan statements, or credit card terms from roughly 1990 to 2010. If you see an insurance or protection charge you don’t recognise, that’s worth investigating. The 2019 deadline closed the door on standard PPI claims for UK-regulated products, but it didn’t end the story for commission-related mis-selling, cross-border agreements, or newer financial products that replicate the same structure.
The Commission Scandal: PPI Mis-Selling in Car Finance and Beyond
How Hidden Commissions Drove Mis-Selling
PPI was profitable not just because of premiums but because of the commission structure behind it. Brokers and salespeople earned large commissions for every policy sold. That incentive meant they pushed PPI onto customers who didn’t need it, couldn’t claim on it, or hadn’t agreed to it. The lender got interest income; the broker got commission; the borrower paid for a product that served neither of them.
The same logic reappeared in car finance. Before the FCA banned discretionary commission arrangements (DCAs) in January 2021, car finance brokers could set the interest rate on a loan within a band defined by the lender. The higher the rate they set, the more commission they earned. There was no requirement to tell the customer. Consumer advocacy groups and major financial commentators estimate that millions of car finance agreements written before 2021 may contain undisclosed commissions of this kind, a pool of affected borrowers potentially larger than classic PPI. Understanding how car finance and insurance products are structured for higher-risk borrowers helps explain why lower-income and younger borrowers were disproportionately targeted.
The UK Court of Appeal Ruling and Its Global Ripple Effect
In October 2024, the UK Court of Appeal ruled in Johnson v Firstrand Bank that lenders can be liable when brokers receive undisclosed discretionary commissions on car finance deals. The ruling directly echoes the logic of PPI mis-selling: a lender’s failure to clearly disclose a commission, especially one that inflated the cost of credit, constitutes a breach of fiduciary duty, entitling the borrower to a refund of that excess charge.
This isn’t just a UK issue. Regulators in multiple jurisdictions are scrutinising similar broker-lender commission structures in consumer credit markets. If you took out a car loan or a bundled finance-and-insurance product across borders, the same undisclosed-commission logic may apply to your agreement. The FCA’s ongoing motor finance review signals that further redress schemes are likely before the end of 2026.
Are You Eligible to Reclaim PPI Insurance Payments?
Common Eligibility Scenarios
Eligibility for a payment protection insurance claim is broader than most people think. You may have a valid claim if:
- You had a loan, credit card, mortgage, or store card between 1990 and 2010 and a monthly insurance charge appeared on your statements.
- You were self-employed, retired, or had a pre-existing medical condition at the time, meaning the policy could never have paid out for you.
- You were not told PPI was optional or that you could buy equivalent cover elsewhere.
- Your PPI premium was significantly inflated by undisclosed broker commission.
- You have a car finance agreement signed before January 2021 that included a protection or gap insurance product with a discretionary commission component.
Non-UK residents are not automatically excluded. Cross-border credit agreements, for example, a UK-regulated product taken out while living abroad, or a foreign-bank product sold under UK consumer credit rules, can carry the same mis-selling liability. If the agreement was governed by UK law or sold through a UK-authorised firm, UK consumer protections apply.
What If You Already Received a Partial PPI Settlement?
Receiving a previous payout doesn’t close the door entirely. If the original settlement didn’t account for the full commission element, which was common before Johnson v Firstrand clarified the commission-redress principle, you may be entitled to a top-up claim. The test is whether the redress you received genuinely compensated for the commission overcharge, not just the basic premium. Review your original settlement letter carefully. If it references only the premium and statutory interest without mentioning commission, a further claim is worth investigating.
The PPI Settlement Process: Step by Step
Gathering Evidence and Submitting Your Payment Protection Insurance Claim
You don’t need your original paperwork to make a claim. Here’s how to start:
- Identify the lender. Recall every credit product you held between 1990 and 2010, credit cards, personal loans, store cards, mortgages, and car finance.
- Request your records. Write to each lender under a Subject Access Request (SAR). Under UK GDPR, they must provide your personal data, including historical account statements, within 30 days. There is no fee.
- Look for the charge. Scan statements for recurring insurance or protection charges. Note the total paid over the life of the policy.
- Write your complaint. Address it directly to the lender’s complaints department. State that you believe PPI was mis-sold, explain why (e.g. you weren’t told it was optional, you were ineligible to claim), and ask for a full refund of premiums plus interest.
- Escalate if needed. If the lender rejects your claim or fails to respond within eight weeks, escalate to the Financial Ombudsman Service (FOS). The FOS handles complaints at no cost to you. Knowing what to do when an insurance claim is denied, and the grounds on which to challenge that denial, can strengthen your escalation.
Timelines, Compensation Calculations, and What to Expect
Lenders have eight weeks to respond to your complaint. The FOS then has its own queue, which can extend the process to several months, though straightforward cases resolve faster.
Compensation is calculated as: all premiums paid + statutory interest at 8% per year on each premium, from the date it was paid to the date of settlement. For a policy running over several years, the interest component alone can be substantial. For a deeper look at how insurance settlement amounts are calculated and negotiated, that resource walks through the redress formula in practical terms.
If the claim involves an undisclosed commission, the redress calculation may also include the commission amount itself, per the Johnson v Firstrand principle. This is a newer element and lenders may not apply it automatically, you may need to specifically request it.
Avoiding Pitfalls: Claims Management Companies and Scam Red Flags
The PPI claims industry attracted a wave of claims management companies (CMCs), some legitimate, many predatory. Watch for these red flags:
- Upfront fees. A legitimate CMC charges nothing until you receive a payout. Any company asking for money before they’ve done anything is a scam.
- Cold calls and unsolicited texts. Reputable firms do not cold-call. If someone contacts you claiming you’re definitely owed money without knowing your account history, hang up.
- Guaranteed outcome promises. No firm can guarantee a payout. Claims depend on the specifics of your agreement and the lender’s response.
- Unregulated operators. CMCs operating in the UK must be authorised by the FCA. Check the FCA register at fca.org.uk before engaging anyone.
You can submit a PPI settlement claim directly to your lender and to the FOS at no cost. If you prefer professional help, authorised CMCs typically charge between 15% and 30% of your redress as a success fee, a significant slice of money you’re entitled to keep. Finances Claims offers a free eligibility check as a no-cost first step, so you can understand your position before deciding whether to involve anyone else.
If your lender pushes back or rejects your claim outright, appealing a denied financial claim follows a structured process you can pursue through the FOS without paying anyone a penny.
Frequently Asked Questions About PPI Payment Protection Insurance Settlement
Is it too late to claim?
For standard PPI on UK-regulated products, the FCA’s August 2019 deadline has passed for most cases. However, claims based on undisclosed commission, the legal principle confirmed in Johnson v Firstrand, operate under a different limitation framework. Car finance commission claims are actively being processed in 2026. If you’re unsure, submit an inquiry and let the facts of your agreement determine eligibility rather than assuming time has run out.
Can I claim if my lender has gone bust?
Yes. If the lender is in administration or has ceased trading, your claim goes to the Financial Services Compensation Scheme (FSCS), which covers eligible claims up to its statutory limits. The FSCS is a free service.
How long does a PPI settlement take?
Direct lender complaints must receive a response within eight weeks. If escalated to the FOS, add several months depending on caseload. Cases involving undisclosed commissions may take longer as the FCA’s motor finance review continues through 2026.
Will making a claim affect my credit score?
No. Submitting a PPI complaint or reclaim does not appear on your credit file and has no effect on your credit score. Lenders are prohibited from penalising customers for raising legitimate complaints.
I’m not based in the UK, can I still claim?
If your credit agreement was governed by UK law or sold through a UK-authorised firm, UK consumer protections likely apply regardless of where you currently live. Cross-border claims are more complex but not impossible, a free eligibility check is the fastest way to find out where you stand.
The PPI payment protection insurance settlement process is more accessible than most people realise, and the window hasn’t closed as firmly as the banks would like you to believe. Start with a free eligibility check at Finances Claims, no upfront cost, no obligation, and find out whether there’s money owed to you before deciding on your next step.