Payment Protection Insurance Investigation to Go Ahead
OFT confirms it is to investigate payment protection insurance
8th December 2005
The Office of Fair Trading (OFT) has confirmed that it is to investigate the payment protection insurance (PPI) industry, following September's 'super complaint' by Citizens Advice.
The complaint alleged that PPI was often sold to those who could not benefit from it, that it was made purposefully difficult to claim on it, and that it was often more expensive than it needed to be.
By law, the OFT had to make a public comment on the complaint within 90 days, and they have now announced that a full investigation into the industry will be launched in the new year.
The statement said that a number of points of concern had already been identified, including lack of choice, transparency, and the difficulty of shopping around. Profit levels will also be looked at more closely.
Should the investigation find failings in the market that make PPI more expensive than it should be, the OFT can ultimately refer the case to the Competition Commission who have powers to take enforcement action against the insurers involved.
Read More: BBC : Debt insurance to be investigated
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More on Payment Protection Insurance : Loans.co.uk Fined £455k (News, 26/10/2006), OFT Complaint Against Payment Protection 'Racket' (News, 13/09/2005), FSA to Probe Protection Insurance (News, 25/07/2005) |
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