It has been reported that a widow was refused PPI compensation payout following her late husband making a claim against Tesco Bank for mis-sold payment protection insurance (PPI).
Tesco Bank advised they would not pay the £3,400 PPI compensation without first seeing the original Grant of Probate for her husband’s Will, who died in March this year.
There had been delays in proving the validity of the Will due to it being drawn up nearly 30 years ago by a firm that is no longer in operation and naming two solicitors from the same firm as co-executors.
The widow realised that the Will could not be verified, nor could she be named as sole executrix until a successor firm could be found and instructed to sign a Renunciation.
She later sent an authenticated copy of the Will to Tesco Bank because she was not prepared to send the original legal documents, but they refused it on the grounds that it looked like a photocopy.
As her husband died unexpectantly, the prolonged process of proving the validity of her husband’s Will means she has no access to his estate and its assets.
It later transpired that Tesco Bank had made a blunder due to their PPI department being incompetent, but this only exasperated the situation for the recently bereaved client.
According to experts, a PPI claim for £3,400 is well below the limit most financial companies use when insisting on probate documents as evidence before releasing money. Usually, the threshold is £5,000 but can sometimes be even up to £50,000.
According to Tesco Bank’s own website, it confirmed it would not ask for the Grant of Probate on a bank account unless its value exceeds £25,000.
Since the mistake, Tesco Bank has apologised for “falling short of its own high standards on this occasion” and paid the full amount of compensation immediately. Due to the error, they also offered a further £200 “for the inconvenience and distress that has been caused.”
This incident raises an important issue of keeping Wills up to date as circumstances change but unfortunately, in this instance, the testator died suddenly – which meant the PPI claim was not logged in the Will as an asset. Nevertheless, it is a good idea to review Wills every 5 years or whenever there are any major life events – such as marriage, divorce or having children.
As the August 29th deadline for PPI compensation claims draws ever closer, recently the Society of Trust and Estate Practitioners (STEP) have released a warning to executors, administrators and estate administration providers of the worrying issues that could impact on a deceased person’s estate.
With millions of pounds already been claimed over the past decade, billions still loiter in the coffers of the financial institutions, unclaimed by the customers that were unfairly mis-sold the product in the first place.
Those who feel that they were mis-sold PPI only have until August 29th, 2019, to make a compensation claim.
The Financial Conduct Authority’s (FCA) official guidance suggests that all people with any kind of financial credit product through the 90s and 00s should check whether they had PPI with their credit provider and pursue a claim whilst there is still time. This same advice also applies to executors, administrators and estate administration providers working on behalf of a deceased person’s estate.
Simon Hancox, Chief Executive Officer at Kings Court Trust stresses the importance of estate administrators carrying out PPI due diligence processes. He said:
“The role of any Personal Representative is to maximise the value of the estate on behalf of the beneficiaries. With this in mind, a valid PPI claim will form part of the assets of an estate. Without checking whether there is a valid claim for PPI there is a risk that the Personal Representative could be seen as negligent in their duty.”
He further adds about the potential implications for executors who have already administered or are in the process of administering an estate:
“If checks are not carried out prior to the 29th August, claims could be made by beneficiaries in relation to a failure of duties of the Personal Representative.”
