Watchdog’s crackdown on PPI cover
Payment protection insurance (PPI) will no longer be allowed to be sold alongside credit agreements, the Competition Commission said today.
The move, which comes into force next year, follows an investigation into the policies, which are sold to make the repayments on loans in the event of unemployment or sickness.
Consumers were often unaware that they could get their PPI from other providers, so did not shop around for better quotes, leading to widespread overcharging.
Companies will now no longer be able to sell PPI at the same time as giving out credit cards, loans or other credit agreements.
The sale of single premium PPI, in which the cost for the entire term of the policy is paid upfront and usually added to the debt taken out, will also be banned.
In addition, the Commission is introducing a package of measures to boost competition in the market.
