Payment Protection Insurance, also known as PPI is an insurance policy which is taken out alongside various forms of finance; it is designed to cover your monthly finance repayments when you are unable to pay them.
The policy is most likely to have been taken out at the same time you obtained finance, even though you may not have been aware that you were taking it. These policies are usually sold as part of the deal when you take out loans, mortgages, credit cards or finance for high value items such as cars.
The insurance was designed as a product that would cover your monthly finance repayments if you were ever unable to work. It was designed to cover those who had been made redundant or had become unemployed through no fault of their own, or those who had suffered an illness or accident which made them unable to work.