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29 Mar 2024
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Moneyfacts.co.uk  response to the FSA update on the sale of PPI

Andrew Hagger of moneyfacts.co.uk comments:

"We have all been aware of the shortcomings of PPI products and the associated sales process for longer than we care to remember and are disappointed that it appears that we are really still no further forward.

"If the FSA is aware of the providers that are still failing to treat customers fairly, then why is it not sending a warning message to the rest of the industry by naming the offenders it has identified.

"By entering into a further period of mystery shopping, it means that consumers are still potentially going to be sold unsuitable, overpriced and inflexible products via a flawed sales process.

"Consumers have little faith in the financial services industry as shown by the reaction to the Northern Rock incident, so this lack of action is going to do little to improve the customer perception of our industry.

"It is inevitable that changes need to happen sooner rather than later, so why is the FSA not being more forceful, rather than allowing the institutions to continue to rake in vast profits from the sale of PPI.

"The table below highlights the huge variation in cost between lenders and also shows that you can get this cover at a fifth of the cost from Independent providers."

Figures based on: £10K over 5 years

 

 

 

 

 

MOST EXPENSIVE

 

 

 

 

 

 

Lender

APR %

Monthly Repayment including insurance

Monthly Repayment excluding insurance

Monthly Cost of PPI 

Total Cost of PPI

 

Britannia BS

6.9

£268.82

£198.99

£69.83

£4,189.80

 

AA

6.9

£260.06

£198.99

£61.07

£3,664.20

 

Intelligent Finance

7.4

£261.19

£201.38

£59.81

£3,588.60

 

Sainsbury's Bank

6.5

£253.59

£195.01

£58.58

£3,514.80

 

Eskimo Loans

8.9

£263.79

£205.61

£58.18

£3,490.80

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MOST COMPETITIVE

 

 

 

 

 

 

Lender

APR %

Monthly Repayment including insurance

Monthly Repayment excluding insurance

Monthly Cost of PPI 

Total Cost of PPI

 

Leeds BS

8.7

£229.10

£204.55

£24.55

£1,473.00

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXAMPLE OF INDEPENDENT PROVIDER

 

 

 

 

 

 

 

 

 

 

 

 

Paymentcare.co.uk

Monthly cost of £11 for LASU cover (Life, accident, sickness and unemployment) - total cost for 5 years cover 

 

at £200 per month = £660

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SOURCE: Moneyfacts.co.uk - the money search engine

 

 

 

 

Moneyfacts Group
Moneyfacts is the UK’s leading independent provider of personal financial information and our data is used and trusted throughout the financial industry. 

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