Payment protection insurance once seemed like a truly amazing idea. An insurance to protect the vulnerable from financial ruin in the event of job loss can be a great thing, at least until the individual has to actually file their PPI claim. At that point the situation becomes much more complicated, since the insurers and lenders have found numerous ways to worm their way out of ever having to actually provide their benefits to people in need.
The truth is that payment protection insurance can still work for you, but you may need to fight to receive it. The majority of all PPI claims are rejected by the lenders regardless of the merit of the individual claims, yet many people have found that they can either push their case and claim their benefits or reclaim the money they spent to pay the premiums. Your PPI claim may still be valid if you filed immediately after your financial situation changed (and you were eligible to receive the benefits in the first place). One key issue is making sure that you do not make additional payments on your debt after your situation is altered, as this can invalidate your claim.
On the other hand if you were miss-sold a PPI plan that you are unable to claim due to already receiving similar benefits from your employer or another agency it may be possible to reclaim your money, which can go a long way toward paying off your current debts. For example, the average PPI plan costs between 16% and 25% of the original loan, and if it was a simple premium policy (meaning paid up front as part of the original loan) you are probably paying interest on the premiums in addition to the loan. All or some of this money can be reclaimed if you were sold the policy without your knowledge or without being eligible to claim the benefits in the first place. You can also reclaim this money if you were self employed. This presents another potential route to reclaim your losses and stabilize your debts in lieu of claiming the actual benefits.