Watchdog May Make Changes To Ppi Prices And Sales
The Competition Commission has decided that it may make some changes to the pricing of Payment Protection Insurance
The Competition Commission has decided that it may make some changes to the pricing of Payment Protection Insurance as well as to the way that it is sold, after further evidence that PPI is still being mis-sold and consumers are being ripped off over the cost of PPI.
PPI has already been at the centre of controversy and the Financial Services Authority has been cracking down on companies found to be mis-selling the insurance, often to people that can never claim on it. The insurance is designed to cover repayments on debts if the policyholder cannot work due to ill health or redundancy.
One official from the Competition Commission said: ‘We’ve found serious problems with the PPI market and consumers are paying for the lack of competition. The way PPI is sold as an ‘add-on’ to a loan or other credit product means distributors escape the pressure they should face from competing suppliers.’
He added: ‘Distributors don’t appear to compete much with each other on either price or quality of PPI, neither do they appear to do much direct advertising of PPI to win customers from each other.’ Changes could include placing a price cap on this insurance and also stopping it from being sold alongside loans and credit.