FSA forced to delay payment protection insurance changes
Under immense pressure from the financial services industry the Financial Services Authority (FSA) has today confirmed that the consultation period regarding the potential mis-selling of payment protection insurance will be extended by a further six weeks. This is a blow to the consumer sector where a number of customers have already stepped forward alleging they were mis-sold payment protection insurance by various financial institutions.
There have been a number of changes to the initial FSA proposals to rectify perceived problems in the system but it is the revelation of a potential compensation bill between £700 million and £1.2 billion over the next five years which has shocked the FSA. It is also believed that customers who have not complained, but may well have been mis-sold payment protection insurance in the past, could be eligible for compensation in the region of £1 billion-£3 billion.
While there is no doubt that changes need to be made with regards to the payment protection industry and the way in which this insurance is sold, the FSA has been forced back to the drawing board by the power and strength of the financial services industry. It is likely that proposals at the end of the consultation period could be a significantly watered-down version of the initial plans.
Moneyfacts website defends PPI
As Payment Protection Insurance (PPI) came under fire last month from the Office of Fair Trading (OFT) for lack of clarity, Moneyfacts has defended the scheme as "an invaluable safety net".PPI covers borrowers who find it difficult to manage loan and card repayments because of long-term illness or unemployment.The OFT demanded that the Competition Commission launch an investigation following compl...Read More
Homeowners advised to guard gardens
Homeowners need to review their garden security as summer fast approaches, Sainsbury's Bank has advised.Research from the financial services provider has revealed that summer sees an increase in the number of home insurance claims for stolen garden items.The average home insurance claim for garden theft is £291, with opportunistic thieves targeting furniture and expensive toys. Neil Laird, Sainsb...Read More
Benefits still available on cheap insurance policies
Such is the healthy competitive state of the car and home insurance markets at present, that inexpensive policies can be found containing benefits for the holder, one industry figure has claimed.Head of research at moneysupermarket, Peter Gerrard, has highlighted the end of the big companies' domination, with insurers vying to offer the customer the best deals and recommended scouring the market f...Read More
Devastating floods could cost insurance industry over £100 million
The devastating floods in Cumbria and South Scotland could cost the UK insurance industry in excess of £100 million although this figure could rise significantly because the flooding has yet to subside. We have literally seen homes washed away in the flood water, vehicles left battered on the road site and indeed we have seen the unfortunate sight of casualties and fatalities during the floods....Read More
'Life insurance is vital for the self-employed'
Life insurance is crucial for those who are self-employed and those who are considering going into business for themselves, life insurance expert has claimed. According to Nick Kirwan of the Association of British Insurers (ABI), Britons are "hugely underinsured for life cover" with up to one in three people having no life insurance. The ABI also estimates that a further one in three have failed t...Read More