It says looking elsewhere can also help to avoid being sold an unsuitable policy, citing loan protection as of limited use for self-employed people because they are unable to claim for redundancy.
Simon Burgess, Managing Director of Burgesses , says "The findings reveal that banks continue to profiteer from selling this product and that people are paying a heavy price for failing to shop around. They are succumbing to underhand tactics often used by banks, which include adding the cost of cover to the loan without necessarily telling people they have done so"
Burgessesoffers the following advice to consumers:
- Check carefully before you sign an agreement that loan protection insurance has not been included in the cost of the loan without you realising it
- If loan protection has been included, make sure you understand exactly what you are covered for and how much it is going to cost
- Work out what the benefits will be if you lose your job – you could be better off with an income protection policy than with loan protection
- If you discover you have been mis-sold a policy, you can complain to the company and potentially have a case to take to the Financial Ombudsman Service.
