Shane Craig, managing director of standalone payment protection insurance provider Paymentcare.co.uk., says “Concerns that borrowers will be put at risk by the Competition Commission’s proposed changes to the payment protection insurance market would be completely unfounded if consumers were made more aware of the standalone alternative to lenders’ own PPI. The solution is staring everyone in the face. The banks have kept quiet and hoped that no one would mention that an easily sourced cheaper alternative has been available all along. There has always been an affordable and genuine option for borrowers to safeguard their finances – standalone monthly paid PPI policies.
“As the Competition Commission has finally made public, lenders have had an unfair advantage when it comes to selling PPI because of the point-of-sale link with the credit agreement. The standalone market has been saying this all along but because of the huge advantage that lenders have been enjoying over the independent sector, the message has been very difficult to get across. And that has unquestionably been to the detriment of the consumer.”
“Borrowers who have baulked at the expensive PPI policies offered by their lender and taken the initiative of looking elsewhere for protection have reported their surprise at the massive difference in premiums of a standalone policy.
“Far from posing a risk to borrowers, this latest development in the ongoing campaign to ensure customers are treated fairly represents the breakthrough that consumers have so badly needed and have been for so long denied.
“The only risk is to the pockets of banks and insurers who sell over-priced insurance.”
Income protection insurance: News update: June 2008