Lloyds Banking Group has set aside a further £375m to cover payment protection insurance (PPI) payouts. The new provisions take Lloyds’ total to £3.575bn.
The Lloyds move comes just days after Barclays was forced to set aside a further £300m to pay its own PPI claims, taking Barclays’ total PPI provisions to £1.47bn.
PPI compensation increases further
The UK’s five biggest banks, Barclays, Lloyds Banking Group, HSBC, Santander and RBS, have now set aside a total of £7.35bn. This figure is likely to rise further later this week when RBS is also expected to increase its provision.
Which? and MoneySavingExpert.com PPI summit
The announcements by Lloyds and Barclays follow the PPI Summit, hosted by Which? and MoneySavingExpert.com last week, where major banks, credit card providers, regulators and the Financial Ombudsman Service pledged to take action to make the PPI claim process easier. There is some £5bn of mis-sold payment protection still available to be claimed. At the end of 2011 Lloyds had paid out around £1bn of its £3bn PPI provision.
PPI is designed to cover your loan and credit card repayments if you’re unable to work, or if you fall ill or die. Widespread mis-selling of PPI policies has led to the growth of exploitative claims management companies (CMCs) offering to help consumers put in a PPI claim, and charging a hefty fee for the service.
The PPI Summit raised awareness of how easily consumers can reclaim mis-sold PPI for free without any need to use a claims management company.
• Which? PPI campaign – use our free online tool to lodge your PPI mis-selling claim
• Use our free online PPI claim tool- Which? helps you submit a PPI claim
• Which banks have the best customer satisfaction? – check out our recommended providers