Press Release

Paymentshield issues reassurance to intermediaries advising on MPPI

Paymentshield, the largest independent supplier of mortgage related general insurance products to the intermediary sector, is reminding intermediaries to be aware of the guidance issued in the latest PPI reviews to ensure they comply with existing rules when advising customers on MPPI products.

The recent results of OFT and FSA investigations into PPI propose to refer the PPI market, including MPPI, to the Competition Commission to investigate selling practices within the industry. Paymentshield has highlighted some of the most relevant points raised by the regulator and put together a simple checklist to reassure intermediaries who may be worried about advising on the product in light of the recent investigations.

Intermediaries need to check that:

Customers understand the limitations of the policy as well as the benefits
Eligibility is checked before application
Customers are made fully aware of any parts of the policy under which they may not be able to claim
For advised sales, firms recommend suitable policies that meet demands and needs
They assess whether existing cover is in force and taking this into account in the advice process
They ensure that a tailored demands and needs statement is given to the client and retained on the client record
They ensure that customers understand what a 'pre existing' medical condition is and the importance of disclosing such
Customers are aware of significant and unusual exclusions and limitations and know where to look for more information.

Chris Traynor, Sales and Marketing Director at Paymentshield comments: "The recent FSA and OFT publication will have undoubtedly made intermediaries more apprehensive about advising on and selling MPPI. While we are disappointed that the PPI investigation has failed to pick up the way that the vast majority of the mortgage intermediary market works in selling regular premium MPPI, we think the market now has to concentrate on making sure that advisers are continuing their important work in ensuring customers have sufficient protection in place.

"We hope that our checklist will help advisers to feel more confident about advising on MPPI, by emphasizing the main points they have to be aware of in the advice and sales process. There are a variety of reports out that highlight that MPPI is a valuable and important product for consumers and it is important that the recent reports do not result in fewer intermediaries willing to advise on the product."

-ENDS-

Notes to Editor:

Paymentshield Limited is the largest independent supplier of general insurance products to the mortgage intermediary sector with current new business levels consistently exceeding 30,000 policies a month. Paymentshield only sells through intermediaries and over 27,000 intermediaries have chosen Paymentshield.

For all further enquiries, please contact:

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

Inez de Koning / Anna Schirmer
Lansons Communications
Tel - 0207 294 3623 / 0207 294 3605
E-mail - inezd@lansons.com / annas@lansons.com