Banks pre-empt loss of profits
- 21ST MAY 2007
The high street bank has always been onto a good thing with payment protection insurance (PPI) as it is responsible for making them huge profits, quickly and easily. Payment protection insurance is a private insurance designed to safeguard the consumer when they take a loan, mortgage or credit of any kind, in the event of them finding themselves out of work due to long term illness, accident or involuntary redundancy.
Consumers can shop around for their policy but the banks and lenders have been devious and “persuade” the consumer to take their massively over priced product without advising them that the product is not compulsory and can be bought independently.
With the Financial Ombudsman Service handling the mis-dealings of the sector and the Government body the Competition Commission undergoing a 2 year investigation of the industry, it now looks as though things could be set to change and the banks will lose the “easy life” they have held onto for so long. However they don’t give up that easy, and if they can’t rake in huge profits on payment protection insurance, then they will get it another way.
One of the ways in which it is thought that banks will make up for the loss is by ending “free” banking. Some banks indeed have already knocked this is the head and started charging for using current accounts. Other charges are also thought to be in the pipeline such as paying more if you send and receive a large amount of cheques.
While changes clearly need to be made in the payment protection insurance sector it seems the consumer just can’t win. However if you want a quality insurance policy then you are a sure winner if you visit British Insurance. British Insurance is a standalone and ethical provider who offer among the cheapest premiums on payment protection insurance policies.
