Competition Commission too slow in PPI market investigation

The Competition Commission is standing by and letting millions of cash-strapped consumers waste money on inflated Payment Protection Insurance (PPI) premiums, despite a promise to investigate this market, says independent provider, Simon Burgess from British Insurance.

[ClickPress, Tue May 08 2007] The Competition Commission is standing by and letting millions of cash-strapped consumers waste money on inflated Payment Protection Insurance (PPI) premiums, despite a promise to investigate this market, says independent provider, Simon Burgess from British Insurance.

He comments: “It’s been well-documented that features of this sector are preventing, restricting, or distorting competition and thereby harming consumers. Given the seriousness of the Office of Fair Trading’s allegations -consumers pay excessive prices for PPI, there’s evidence of high pressure and unfair sales tactics, and claims administration is slow and unfair leaving consumers facing additional charges or serious debt enforcement action - I’m astounded the Commission isn’t moving more quickly to prevent consumers being ripped off and suffering financially.”

The OFT referred the PPI market to the Commission in February this year and in response it published an administration timetable, detailing when its first ‘emerging thinking’ document will be produced.

Simon continued: “We’ve got to wait four months before the so-called ‘thinking’ document appears. This will no doubt repeat the OFT’s findings and tell us what we already know. Questionnaires, hearings and requests for submissions are all very well, but they will not protect consumers now. Enough research has been carried out, so why has the Commission set a deadline for February 2009 for the implementation of remedial measures? This is unacceptable.

“Research already shows that the current rate rises have resulted in a quarter of all mortgage holders being financially stretched and millions of homeowners may have to remortgage, resulting in even more debt.”

He concludes: “What’s more worrying is the recent Which? report detailing how consumers obtaining loans over the phone or internet are being tricked into buying PPI cover. More than half the quotes researchers received over the phone for loans automatically included PPI cover and well known providers such as Lloyds TSB, Natwest and Tesco did the same online. What more evidence does the Commission need? There have been calls for this practice to be outlawed and yet consumers are still being allowed to fall victim to it.”

Contact:
Simon Burgess Managing Director of British Insurance on 07718 152635. Case studies available.
Further information on payment protection insurance can be found at www.britishinsurance.co.uk

Editors Notes:

British Insurance regularly tops Which? And Defaqto’s ‘Best Buy’ tables. The company was awarded Mortgage Strategy magazine’s General Insurance Distributor of the Year accolade in Feb 07 and was recognised by Mortgage Introducer as the Best Mortgage Payment Protection Insurance provider in April 07. British Insurance also holds What Mortgage? magazine’s Best Insurance Broker Award for 2006.

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