PPI Complaints Set To Increase In 2010/11
PPI complaints look set to rise in 2010/11.
The Financial Ombudsman Service anticipates complaints about Payment Protection Insurance (PPI) will continue to rise for the period 2010/11, after there were 13,520 new complaints in the first quarter alone.
These figures were published today in Ombudsman News.
For the period 2009/10, the Financial Ombudsman Service received a total of 49,196 complaints about PPI. If PPI complaints continue at a steady pace, then total complaints will reach 54,080 for the period 2010/2011.
According to the figures published in Ombudsman News, 34 per cent of all complaints received by the Financial Ombudsman Service in April, May and June, were about PPI.
The Financial Ombudsman Service has said it will be using Ombudsman News to publish snapshots of its workload on a quarterly basis.
A statement released by the Service said “This should make it easier for everyone to see the numbers and trends as they emerge throughout the year rather than only seeing the figures annually, after the financial year has ended.”
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Competition Commission Discuss Changes To PPI
Competition Commission makes provisional decision on retail PPI remedies.
The independent public body, the Competition Commission has today (29/07/10) released a report consulting on changes to the way retail Payment Protection Insurance (PPI) is sold.
Retail PPI is one specific product in the overall PPI market. Retail PPI relates to protection policies taken out on repayments for goods bought from home catalogues.
The Competition Commission is looking to clamp down on the way retail PPI is sold. The document published today puts forward a number of proposals for retail PPI that aim to provide clearer information to customers on the cost of retail PPI cover and the rights they have.
Proposals for retail PPI published in the report include:
- an obligation to offer PPI separately from merchandise cover if both are offered as a bundled product
- an obligation to provide information about the cost of PPI and ‘key messages’ in marketing materials
- an obligation to remind all active customers of their cancellation rights and of key messages on an annual basis
- a prohibition on the sale of single-premium PPI policies and on charges which have a similar economic effect
- an obligation to provide customers who have spent more than £50 on retail PPI premiums in the preceding 12 months with a written annual review of PPI costs
The Competition Commission is now inviting comments on its proposals for retail PPI before publishing the final verdict for the entire PPI market in September.
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FSA Fines PPI Broker
Payment Protection Insurance broker fined by FSA.
The Financial Services Authority (FSA) has today (09/07/10) fined David Head, director of Essex based mortgage and insurance broker network, FT Compliance Services Limited for Payment Protection Insurance (PPI) failings.
The FSA fined David Head, £10,500 for failing to properly supervise insurance brokers who had close links with a firm previously disciplined by the FSA the mis-sale of PPI.
David Head was responsible for insuring FT Compliance Services and its appointed representatives complied with FSA regulation. Head however failed to put in place systems and controls to ensure the appointed representatives made suitable recommendations, exposing customers to the risk of purchasing unsuitable PPI.
Investigation by the FSA found that in cases where single premium PPI was sold:
- Appointed representatives were not properly considering customers eligibility for PPI before making a recommendation
- Customers were not asked about medical conditions or any existing insurance cover that could make PPI unsuitable for them
- Customers weren’t being told they could buy PPI from other providers which would be more suitable for their needs
Margaret Cole, the FSA’s director of enforcement and financial crime said: “As a director of a network, Head was personally responsible for ensuring that the appointed representatives were properly supervised and he failed to do so. His failure is particularly disappointing given that he was on notice that two of the appointed representatives had links with a person previously disciplined by the FSA for PPI failings. There is a serious responsibility attached to being an FSA approved person and Head’s fine demonstrates that we will not tolerate failure to deliver on that responsibility.”
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