According to the body, 74 per cent of respondents to its monthly intermediary survey said they offered policies from more than one provider with the breakdown as follows: 32 per cent - two to three providers; 14 per cent - four to five providers; 2 per cent six to 10 providers; 5 per cent - over 10 but still a limited panel; and 20 per cent whole of market.
The research, conducted amongst AMI members, asked those who do not offer PPI policies why they chose not to. 36 per cent said they offered alternatives, such as income protection instead, while 26 per cent felt the product was ‘poor value’. 74 per cent of respondents offer permanent health insurance/income protection; 87 per cent offer Critical Illness Cover; with 37 per cent offering private health insurance.
The survey also asked members what their reasons for choosing a particular PPI product provider are. The top three reasons were: 90 per cent said the ‘quality of cover and overall value for money’; 85 per cent said the ‘price of cover’ and 54 per cent said the ‘ability to process business online’.
Rob Griffiths, associate director of AMI, commented: “These are important findings in light of the Office of Fair Trading’s (OFT) PPI market study and its proposed market investigation referral to the Competition Commission (CC), which included Mortgage Payment Protection Insurance (MPPI).
“The OFT’s market study suggested that intermediaries were not offering their clients a choice of MPPI from a variety of providers. Our research reveals that the vast majority are offering the policies of more than one provider with a fifth providing access to ‘whole of market’.
“Our response last year outlined the important role intermediaries play in the MPPI sector, shopping around for their client and delivering good value products based on their client’s needs and their research into the products available. Our research shows that the vast majority of intermediary firms primary reason for choosing a PPI provider is the quality of cover the product offers and its overall value for money.
“AMI continues to believe that the MPPI sector should not be included in any referral to the CC and the results of this survey underline our belief that it should be treated differently to the four other PPI sectors outlined by the market study – secured loan PPI, unsecured loan PPI, credit card PPI and store card PPI.
“AMI has shared these results with the OFT as part of our ongoing response to its market study.”
