Campaigning for a fairer PPI market, Sara-Ann Burgess, director at PPI specialist Burgesses, says: “At the moment there are a lot of providers offering very spurious explanations of why they continue to charge single premiums, why they refuse to give pro rata rebates and why cutting the cost of PPI would increase the cost of available credit.”
The Competition Commission has asked for further information from the market before making its final recommendations, and Burgess said it was imperative that a disproportional weight was not given to the comments of those firms that clearly had huge interests in keeping single premiums in place and refusing to rebate consumers on a pro rata basis.
Single premium policies have never stood up to scrutiny, according to Burgess. “They are inflexible, carry unfair terms and the premium paid accrues interest. There has only ever been one winner in this market and it is not the consumer.”
Burgess said it was essential the Competition Commission did not allow itself to be inappropriately swayed by claims made by single premium providers that simply did not stack up and was delighted that some of their initial claims had already been debunked.
“The Commission has said that providers were overstating the case when they said they had significant front end costs to pay in personal loan PPI policies. It has also found that if consumers shop around they can prevent providers from penalizing them if they choose not to take out PPI. I hope the Commission refuses to let itself be hoodwinked as to the realities in this market and takes bold steps to make PPI work as it could and as it should.”
The fact that a growing number of independent providers are offering low cost, flexible products that many of the established providers are struggling to match shows there is a real appetite to give consumers a good deal.
“Firms like British Insurance have shown that PPI does not have to be expensive, complicated or confusing. The Competition Commission must be bold enough to open up the market and allow these players a chance to compete properly against an established guard that has consistently let its customers down,” said Burgess.
