IDEAS home Printed from https://ideas.repec.org/a/mul/jqmthn/doi10.1435-94747y2019i2p339-366.html
   My bibliography  Save this article

Determining the Refund of a Payment Protection Insurance when Consumers Pay off the Loan Early

Author

Listed:
  • Stefania Corsaro
  • Zelda Marino
  • Gabriele Sampagnaro

Abstract

This study aims to identify a “criteriaµ able to determine the refund of a payment protection insurance (PPI) premiums in the event of an early repayment of a loan. While the current criterion employed both by regular courts and in arbitration, i.e “pro rata temporis criteriaµ, is respectful of the principle of fairness, it is not fully compliant with the relevant legislation on the rights of consumers of financial services. In fact, the article 22, paragraph 15-quater of the D.L. 18/10/2012 n. 179, which almost entirely repeats the content of art. 49 of the IVASS Regulation 35/2010, states that the repayment of the premium must be made also considering the residual debt; since "pro rata temporis" principle doesn’t consider the residual debt of the loan, it leads to an overestimation of the refund that a consumer receive if he pays off the loan early. On the basis of these premises, the article proposes some alternative criteria able to mitigate the shortcoming of "pro rata temporis" principle.

Suggested Citation

  • Stefania Corsaro & Zelda Marino & Gabriele Sampagnaro, 2019. "Determining the Refund of a Payment Protection Insurance when Consumers Pay off the Loan Early," Banca Impresa Società, Società editrice il Mulino, issue 2, pages 339-366.
    • Handle: RePEc:mul:jqmthn:doi:10.1435/94747:y:2019:i:2:p:339-366
    as

    Download full text from publisher

    File URL: https://www.rivisteweb.it/download/article/10.1435/94747
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://www.rivisteweb.it/doi/10.1435/94747
    Download Restriction: no
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mul:jqmthn:doi:10.1435/94747:y:2019:i:2:p:339-366. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://www.rivisteweb.it/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.