Autumn sees first Commission document
- 5TH MAY 2007
With the Competition Commission recently announcing that it will release its first document relating to its investigation into of payment protection insurance (PPI) market in Autumn, there have been calls from industry insiders for providers to start treating their customers more ‘fairly’.
Financial data website moneyfacts.co.uk recently made a very public plea asking that the payment protection insurance treat the consumers “fairly” and ensure that when giving quotes, that they do so based on every £100 of benefit.
This backs up the concerns of industry expert Simon Burgess, who has long campaigned for fairer treatment of consumers who purchase payment protection insurance.
Payment protection insurance is a private insurance that is taken out to protect the repayments on loans, credit cards and mortgages should the policyholder find themselves out of work due to long term sickness, redundancy or accident. The insurance ensures that monthly credit repayments can be met by providing a lump sum tax-free monthly amount, typically for up to 12 months – or when the policyholder returns to work, whatever is the sooner.
Payment protection insurance has been firmly in the headlines for months now – and for negative reasons. Many well known companies have faced fines for their failings when selling payment protection insurance and some consumers have already made successful compensation claims against their insurers for mis-sold policies.
Simon, who is MD of ethical standalone payment protection insurance provider British Insurance, is hopeful that the intervention by the Competition Commission - who are currently investigating the industry – will bring an end to days of “mass profiteering” by lenders and banks.
He says that many areas need to be addressed to stop many consumers getting unsuitable and often over priced cover.
He says: “Many customers are treated unfairly when buying payment protection insurance. They often don’t understand payment protection insurance and are confused as to what the cover actually entails.”
He adds that one area of particular concern is the amount of benefit that a policyholder would be entitled to. “Many people find it a confusing subject as the providers often fail to explain the product and pricing properly, if at all”.
