Consumers are still not getting a good deal
- 27TH JUNE 2007
Over a year into the Financial Services Authority’s investigation into the payment protection insurance industry and the consumer is still not getting a good deal, according to industry insiders. There have been accusations that imply that the FSA is actually trying to find a happy medium rather than looking out for the best interest of the consumer.
The eradication of the nil refund clause in all payment protection insurance policy documents does not go far enough according to certain individuals, including Managing Director of the ethical payment protection insurance provider British Insurance, Simon Burgess.
In a press statement, Burgess commented: “The FSA intervention is lightweight…it says that consumers with a 'nil refund' clause in their contract can get a premium refund if they cancel their policy and have not made a claim or they want to repay the loan early, but key issues are being ignored".
He points out that no guidelines been set on the level of refunds that policyholders can expect, meaning in effect that providers could keep all of the premiums bar one per cetn without falling foul of the FSA.
Burgess believes that the only way to ensure that consumers get a good deal is to abolish the single premium policy completely, andmany others agree with him. Whilst half-hearted measures like this are brought into force, the consumer is simply playing the waiting game.
