Watchdog’s initiative will ensure a better loan insurance deal
In an attempt to help consumers better understand loan insurance (or PPI as It is more commonly known), the UK’s financial watchdog (The FSA) has announced plans to release comprehensive comparative tables of the product, for as early as Q1 2008.
Loan insurance of has been central to much scrutiny throughout 2007, following on from a number of reports in which certain Brokers were court mis-selling the product to consumers. As a result, the watchdog has clamped down on such selling practices, fining a number of brokers along the way.
For those who are not aware of the product, PPI is a specific type of insurance designed to safeguard the borrower in the event of illness, loss of work or any other variable, which could hinder their ability to cohere to the loan terms.
However, in many cases the insurance can be an expensive addition to the overall cost of the loan and can by default, cause the consumer to struggle with repayments (especially if it was not originally planned for).
It is hoped that this new set of information will better allow consumers to decide if the insurance is right for them, and if they are getting a fair deal In the process.
