In its review of PPI selling standards, the regulator confirmed that many firms had failed to give borrowers correct pricing information and had neglected to give customers adequate information over their PPI eligibility. The study also suggested that firms had not told customers why, where advice was given, the particular product was recommended.
However it indicated that firms were making borrowers aware that PPI was optional, and showed that firms were committed to offering cancellation refunds on the majority of single premium policies.
Clive Briault, managing director of retail markets at the FSA, admitted the findings had showed improvements in a number of areas, but expressed his disappointment at continued failings. He said: “We have, on a number of occasions, set out clearly our requirements for the selling of PPI. While some progress has been made by the industry, we are extremely disappointed that some firms have still made little progress in improving their sales practices.”
As a result of the review four firms will undergo investigation, while three firms cancelled their FSA authorisation to sell PPI following the review.
Shane Craig, managing director at Paymentcare.co.uk, said: “The report clearly, and on several occasions, identifies the main culprits that have given loan PPI a bad name as those selling single premium PPI alongside unsecured personal loans.
It’s no surprise that the FSA is seeking to increase the level of fines, it’s just a pity that so many consumers are still being taken advantage of and not experiencing the desired outcomes that the FSA want to see with regards to sales of PPI.”
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