Why take out payment protection?
- 24TH JULY 2007
Payment protection has been a favourite product of high street banks and lenders for years because it has brought in a lot of revenue. The fundamental terms and conditions of payment protection policies have made it difficult for individuals to claim, but a high percentage of payment protection policies have been mis-sold to individuals who were ineligible to claim on it anyway.
Unfortunately, the people who found themselves to be ineligible were often those who were more in need of it.
No payment protection would actually cover anyone who was retired or worked part time, for example and banks offering payment protection would not cover these individuals, but, in some cases due to sloppy sales practices, would sell the policies to them. Some high street providers were also accused of profiteering by failing to ask individuals if they have any pre-existing medical conditions, which would also exempt them from payment protection cover.
Despite this, payment protection can actually be a good policy if sold to individuals whom it would benefit. For example, those who are working full time and are perfectly healthy could claim on the policy if ever they were made redundant or forced to temporarily give up work on account of poor health. However, relevant checks should be done before the payment protection is set up in the first place to make sure that it does suit the individual consumer.
The ethical British Insurance are one company that do actually do all of the relevant checks before setting up payment protection to ensure that it would be of some benefit to the individual consumer. As a product that could save consumers from financial ruin, they take it seriously and treat the consumers with the respect that they deserve.
