Payment protection insurance

Payment protection insurance (PPI) is insurance that will pay out a sum of money to help you cover your monthly repayments on mortgages, loans, credit/store cards or catalogue payments if you are unable to work. This may be as a result of illness, accident, death or unemployment and will be covered on your policy.

PPI is not readily available in Ireland today, with very few financial institutions offering it.

You may not be eligible to make a claim if you are:

• Under 18 or over 65
• Employed for less than 16 hours a week
• Aware you may become unemployed
• Self-employed and go out of business
• A temporary/contract worker and you lose your job
• Aware of an existing medical condition
• Unable to work because of certain common conditions, such as stress or backache

You may not be able to claim for redundancy if you:

• Work in a family business
• Take voluntary redundancy
• Claim during the first three or six months of taking out the policy

Making a claim under an existing PPI policy

If you are out of work due to illness, injury or unemployment and have a payment protection insurance policy in place, there are a number of basic steps you should follow when making a claim:

• Check your policy: check your policy document to see whether the reason you are out of work is covered under the policy. For example, if you are out of work due to an illness that is not covered by the policy, then you will be unable to make a claim. Some policies pay out if you are made redundant but on certain conditions, for example a policy may not pay out if you take voluntary redundancy.
• Speak to your lender: if you are unable to work and wish to make a claim on your PPI, contact your lender to discuss the next steps. You may be requested to complete a claims form. Remember to complete the forms as accurately as possible to avoid delays or refusal of your claim. If you are unsure of any information requested on the form contact the lender.
• Get your paperwork in order: when making a claim on a payment protection policy, you may be required to submit documentation to support your claim. Examples may include medical certificates, medical assessments, proof of redundancy etc. Your lender will advise what is required.

Can you cancel a PPI policy?

You can cancel PPI at any time. If you pay off your loan or hire-purchase agreement early, cancel your credit card or if you simply decide you no longer need this cover, ask your lender to cancel your direct debit and cancel the policy. If you paid the insurance ‘up front’ you may be entitled to a refund of the remaining term. Ask your lender about this.