Press Release

Sales of Regular Premium MPPI Generally Compliant say FSA

In a speech at the Chartered Insurance Institute annual conference, Clive Briault, Managing Director of Retail Markets at the FSA said:

"We have just completed a series of visits to look at PPI selling practices in firms ranging from high street banks to motor dealers and small mortgage intermediaries. We are also undertaking mystery shopping work and will be feeding back the results from the mystery shopping and firm visits later this year.
Our findings from the firm's visits are variable. Some firms demonstrated good compliance with our rules - they were addressing problems that may have existed in the past, such as checking that customers are eligible for the policy before selling it. For example, we found that regular premium PPI sold with prime mortgages seems generally compliant with our rules. However, selling practices in other sectors were very poor"

Graham Boulger - Group Commercial Director at Paymentshield commenting on Mr Briault's speech said "This backs up what we have been saying for some time and hopefully alleviates mortgage advisers concerns that there will be a wide ranging FSA review of MPPI"

Graham added - "There is no evidence of systemic mis-selling of MPPI but there is reluctance from mortgage advisers to sell MPPI at the moment because of the media attention focused on loan payment protection. What Mr Briault says is absolutely true when he draws the analogy with travel insurance, the MPPI market is the only PPI sector where there is open market competition between lenders and intermediaries and this results in consumer choice whilst the competitive pressures ensure that premiums and commissions are kept at acceptable levels, the same cannot be said for loan PPI"

-ENDS-

Notes to Editor:

Source: FSA Communication 23rd September 2005

Paymentshield Limited is the largest independent supplier of general insurance products to the mortgage intermediary sector with one of the largest collections of registered intermediaries in the mortgage market, totalling over 21,000 users.

For all further enquiries, please contact:

Graham Boulger
Group Commercial Director
Tel - 01704 215212
Mobile - 07977 122686
E-mail - graham.boulger@paymentshield.co.uk

Fiona Kitchin
Head of Marketing
Tel - 0870 351 5878 Mobile - 07989 960 166
E-mail - fiona.kitchin@paymentshield.co.uk