Loan cover still a concern
- 19TH DECEMBER 2007
Despite there being changes made by some firms when it comes to selling loan cover, the sector is still causing some major concerns because some providers are still not making it plain about the exclusions in a policy which could mean the consumer would not be eligible to claim.
Problems for the sector began in 2005 when the Office of Fair Trading started an investigation having received a super complaint from the Citizens Advice. Around the same time the Financial Services Authority (FSA) also began its own review of the sector too. As a result, fines were given to several major names on the high street and the industry was referred to the Competition Commission. They are hoping to have the results of their findings available in early 2009.
With 4,000 cases of mis-selling being investigated by the FSA in 2007 which is double those of the year before, loan cover is still a worry for those considering taking it out. However, when bought from an ethical standalone specialist such as British Insurance you can be sure that you will get the vital information needed to make a decision regarding the suitability of the product.
Along with this British Insurance can save you up to 80% on the cost of loan cover when compared with the high street lender, meaning you can protect yourself cheaply against the financial ramifications of becoming out of work due to illness, redundancy or accident.
Typically, cover would begin to pay a tax free sum any time between day 31 of being out of work to day 90 after the first day of the claim and would then continue for up to12 months if it was needed.
Some providers pay the loan cover for up to 24 months so you have to check the small print before taking out the cover. There are common exclusions in all policies with the most usual being if you only work part time, if you suffer a pre-existing condition or are self-employed, but there can be others so again you have to read the small print.
