Santander has lost a £675 million court battle with Axa regarding PPI payouts in London.
AXA Secures Court Victory Against Santander Over PPI Mis-Selling Claims
In a significant legal ruling, AXA has won a court battle against Santander Insurance Services UK, related to payment protection insurance (PPI) mis-selling claims. The London High Court judge, Mr Justice Julia Dias, ruled that AXA is entitled to seek indemnification from Santander for payments AXA made covering consumer redress and costs related to more than 650,000 PPI complaints.
The ruling values AXA’s claim at approximately £675 million (around $908 million), although AXA will receive a portion of this as some liabilities have already been reimbursed by Genworth under separate arrangements.
This case involves AXA inheriting underwriting obligations and liabilities after acquiring Genworth units in 2015, which had underwritten these PPI policies sold initially through businesses acquired by Santander. AXA had paid nearly £500 million in customer redress and about £70 million in associated ombudsman costs, which Santander is now ordered to indemnify under existing agreements.
Santander disagrees with the outcome and intends to appeal the ruling. The judgment does not affect the past redress paid to customers for PPI complaints.
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PPI marked one of the costliest retail financial scandals in British history, with banks being ordered to pay out roughly £40 billion in compensation. Axa sued Santander at the High Court in 2021 over losses related to over 650,000 individual customer complaints about PPI policies. Judge Julia Dias stated that Axa 'has a valid claim for an indemnity' against Santander Insurance Services UK in relation to redress payments and ombudsman fees.
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- In the aftermath of the court victory, AXA, a significant player in the finance industry, is now pursuing indemnification from Santander for losses incurred due to PPI mis-selling claims, worth approximately £675 million.
- This legal battle, stemming from an acquisition in 2015, highlights the intricacies of the insurance and finance business, where AXA was saddled with liabilities after inheriting underwriting obligations from Genworth.
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