Payment Protection Insurance Back In The Firing Line
Personal Loans - June 15th, 2009There has been an awful lot of bad press over the past few months regarding Payment Protection Insurance (PPI), with a growing number of mis selling of policies and a large number of complaints from policyholders who have been unable to claim, or found out that they are not actually covered for what they thought they were, leaving many individuals struggling to keep up with the repayments on their personal loans, credit cards and homeowner loans if they become ill, or are unfortunate enough to lose their job in the current economic climate.
Due to the effects of the credit crunch and general economic slow down, there has been a huge increase in the number of claims which are being made on PPI policies through unemployment, with the number of unemployment claims increasing by a staggering 203 per cent in the space of a twelve month period and this is causing providers of this type of cover to review their premiums and increase the cost, or reduce the level of cover on people’s policies, just at a time when they need them the most.
Now, Lord Turner, Chairman of the Financial Services Authority (FSA), has spoken out against companies who have increased the cost of loan protection policies, claiming it is not in keeping with the FSA’s principle of treating customers fairly.
Lord Turner said “How many consumers would have taken up this cover if they had known at the very time they needed the protection more, the price of it would significantly increase or the amount of cover decrease? This is an area where insurers must expect us to intervene to address poor consumer outcomes. And more than that they must think clearly about the impact of their actions on the sector’s reputation.”

































