Is PPI available on car finance?

If you’re looking to finance a new or used car, you may be wondering if PPI is available. PPI, or payment protection insurance, can provide peace of mind in the event that something happens and you can’t make your car payments. In this blog post, we’ll discuss everything you need to know about PPI on car finance. We’ll cover what it is, how it works, and who should consider buying it.

What is PPI and how does it work on car finance agreements?

Payment Protection Insurance (PPI) is a form of insurance which is designed to cover the repayments on a loan taken out for a car purchase in the event that the borrower can no longer make their payments due to illness, unemployment or death. It ensures that the loan agreement will be honoured and that the borrower won’t face any additional financial hardship from having to pay off an unpaid debt.

When it comes to car finance agreements, PPI can be applied in two different ways. The first way is as a stand-alone policy, where the lender offers you coverage specifically for your loan and you will have to pay an upfront premium or set monthly payments in order to benefit from this protection. The second way is when the lender includes PPI in the finance agreement, where you will pay a higher rate of interest for the duration of the loan and this additional cost is used to cover the cost of the insurance.

The benefits of PPI on car finance agreements

PPI – or payment protection insurance – can be quite beneficial when included on a car finance agreement. PPI helps to cover repayment charges if the borrower is unable to make their payments due to unforeseen circumstances, such as unemployment or illness. This allows them some peace of mind in knowing that they won’t fall into arrears and risk having their vehicle repossessed by the lender.

In addition, some lenders offer additional benefits with certain PPI policies, such as discounted interest rates, extended warranties and legal advice services. This can add further value to the car financing agreement and help you save money in the long run.

How to make a claim for PPI if you’ve been mis-sold it?

PPI is typically mis-sold when a customer has been pressured into taking out the policy, given incorrect advice about it or not aware that they have taken it out at all. If you suspect you may have been mis-sold PPI on car finance, there are a few steps you can take to make a claim.

Firstly, contact your lender directly and explain why you believe the PPI was mis-sold. It’s important to provide as much detail as possible.