As the number of Payment Protection Insurance complaints to the Ombudsman soars to around 2000 a month and yet another firm is fined by the Financial Services Authority for mis-selling PPI, Simon Burgess from British Insurance urges consumers to source cover independently from their loan.
He comments: “PPI is now the most complained about insurance product, and with good reason. It is over-priced and sold via stealth. Many people are under the impression they will not receive credit unless they opt for the accompanying insurance, but now more than ever, customers must hold their nerve, reject these bullying tactics and buy their cover elsewhere.”
The latest FSA fine is £210,000 from Land of Leather. The FSA reports that some 58,000 Land of Leather customers were exposed to questionable PPI sales practices and 8,200 are paying up to £719 for a single premium policy (including interest over thee years).
Simon Burgess argues; “These fines are miniscule compared to the obscene profits made in this sector. However, the net is closing on those who continue to rip-off customers and as a consequence, they are more likely to face a visit from the regulator. Customers must reject PPI offers from companies giving loans for property, cars, furniture etc. If not, the financial payback will be crippling. David took on Goliath and won and consumers must do the same with their credit providers as there are far superior insurance products on the market with substantially cheaper premiums.”
Income protection insurance: News update: June 2008