Comment on the Competition Commission's findings into PPI

Published:

13/11/2008

Topic:

Press Release,Insurance,Income

Clare Francis, site editor of price comparison site, moneysupermarket.com, said "PPI has been a cash cow for lenders for too long now and this crackdown is welcome.  That said, the decoupling of the PPI sale from the loan sale is likely to have one immediate effect which is bad news for consumers - loan rates will rise as lenders look to recoup some of their margin.

"In general standalone PPI is cheaper than that sold by lenders alongside a loan, so consumers will be able to use their "personal PPI quote" as a benchmark price and shop around during the two week cooling off period.  We anticipate that this move will give standalone providers and comparison sites such as moneysupermarket.com a great opportunity to steer consumers toward better value PPI products without any sales pressure.

"Whilst there is no doubt that PPI has, in the past, been over priced and over sold we do believe that there is a place for the product.  The biggest reason for people seeking help with their debts is a change in personal circumstances such as an accident, sickness or unemployment and this is exactly when an appropriate PPI policy can prove a wise purchase. And with the country now in the grip of recession and unemployment on the up it could prove invaluable to an increasing number of people."

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