The £5bn Rip-off
- 5TH MAY 2007
While payment protection insurance (PPI) can be a Godsend should the worse happen, the ongoing investigation by the Competition Commission and the negative press coverage relating to mis-sold policies means it has been deemed as expensive and in some cases nothing but a big rip-off.
Payment protection insurance cover provides the policy holder with a tax-free lump sum every month should they become unable to work due to unforeseen redundancy; prolonged sickness; or accident. It can cover credit such as mortgages, loan and credit card repayments.
The press has highlighted how, shockingly, in some cases the cover is automatically included along with the loan, mortgage or credit card without the consumer even realising they are paying thousands over the term of their loan for the protection.
The payment protection insurance market is thought to be worth around £5bn, however in light of the mis-selling of policies and the compensation claims that are appearing, claims could end up costing £10bn.
Simon Burgess from British Insurance who are an independent payment protection provider offering low cost cover, believes that the high street banks are the biggest offenders when it comes to ripping-off the consumer.
He says that banks charge way over the odds for their premiums which can add thousands onto the cost of the loan or mortgage. “And,” he fumes “along with this, consumers have been sold policies which they cannot possibly claim on such as the retired or those who are employed part-time.
“The whole market stinks and it is time the greedy banks and lender stopped exploiting their customers with over priced premiums.”
So when it comes to payment protection insurance don't get caught up in the £5bn rip-off, purchase your insurance from a standalone provider such as British Insurance independently and say “no” to the greedy banks and lenders.
