Claims management companies have been the cause of much controversy in recent years. They provide services helping customers negotiate complaints systems and other legal processes to win compensation or repayment for loss or damages. Hundreds of claims management companies operate in the UK.

Most are currently focused on offering to help with mis-sold PPI claims after the recent debacle which has required banks and other financial institutions throughout the UK to refund billions of pounds to millions of customers who were wrongly sold an insurance policy they didn't need alongside a loan or credit deal.

Claims management companies purport to greatly increase your chances of successfully reclaiming mis-sold PPI and to greatly reduce the time, effort and stress involved in doing so.

What do Claims Management Companies do?

A claims management company (CMC) will offer to do all of the legwork associated with your claim, the collating of evidence and negotiation with the lender, in exchange for a percentage of the settlement. Reputable ones will work on a no win no fee basis without any upfront fees or hidden costs.

Are They Necessary?

This has been the subject of much debate in recent years. Most banks and other organisations will say that their complaints procedure is customer focused and easy to deal with, thus eliminating the need for customers to enlist any type of professional assistance.

There is evidence, particularly in the case of PPI, that banks will fob customers off wherever they think they can get away with it. CMC's would assert that they are providing a valuable service in standing up for consumers rights and ensuring that banks don't get away with this type of behaviour and eliminating the stressful element of making a claim, which will require a lot of evidence and possibly a lot of detailed negotiation.

Should I Hire a CMC to reclaim my PPI?

This is completely up to you. Having professional assistance will certainly make your claim less stressful and ensure that all of your rights are exercised, there is evidence to suggest that your chances of success or the amount you win are improved by having the right claims team to support you. If you do decide to seek the assistance of a CMC you need to be sure of their reputation. You can check that are registered with the Claims Management Services Regulator, which monitors the industry's standards. A good Claims Management Company will have zero upfront fees and take no more than 25% of your settlement as payment. ClaimsFinancial have an excellent reputation in this area and a high success rate for PPI claims.