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MSE News: PPI sales ban still months away
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Former_MSE_Guy
Posts: 1,650 Forumite
This is the discussion thread for the following MSE News Story:
"The ban on the flogging of debt insurance is unlikely to come into force until 2011, it emerged today ..."
"The ban on the flogging of debt insurance is unlikely to come into force until 2011, it emerged today ..."
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Comments
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"A ban on the sale of debt insurance is still at least a year away after the Competition Commission (CC) revealed it will only lay out its next steps to protecting consumers next summer."
Protecting Consumers? Eh?
How is banning the sale of a product that protects consumers classed as "protecting consumers".
Improve the standards of advice. Fine!
Make the product better/cheaper. Great!
Ban the sale of the product at the only point in time that people actually give it any consideration. Pardon me??
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I am all for banning Single Premium PPI.
However, there is and always has been a requirement for a product that actually protects people rather than simply a means to providing lenders with additional income streams.
Lets have a proper protection product that works. Not a one fits all, "guaranteed it wont pay out" con.I am a former Broker, former IFA and former compliance officer, for my sins.
However, I have since seen the light.0 -
The biggest issue with PPI is that it was allowed to be sold by unregulated, and mostly untrained individuals with sales targets.
Whilst I am not going to suggest things are perfect, you do not find problems to anywhere near the same level in the regulated advice side.
The answer isnt to ban the product but to revise the way it is sold and who sells it.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
"A ban on the sale of debt insurance is still at least a year away after the Competition Commission (CC) revealed it will only lay out its next steps to protecting consumers next summer."
Protecting Consumers? Eh?
How is banning the sale of a product that protects consumers classed as "protecting consumers".
Improve the standards of advice. Fine!
Make the product better/cheaper. Great!
Ban the sale of the product at the only point in time that people actually give it any consideration. Pardon me??
The point is many people are either under the impression they have to take this insurance, or that it is the only provider available, which isn't allowing the consumer to shop around for the best deal.
They need to be given clear advice that they should shop around for this product at the point of sale.0 -
The biggest issue with PPI is that it was allowed to be sold by unregulated, and mostly untrained individuals with sales targets.
Whilst I am not going to suggest things are perfect, you do not find problems to anywhere near the same level in the regulated advice side.
The answer isnt to ban the product but to revise the way it is sold and who sells it.
There is no comparison between monthly payment policies and single premium.
The costs are a world apart. The true cost of ASU is around £4-5 per month per £100 cover and you can delete the parts that are not required, like unemployment cover for those who are self employed, etc. This can bring the cost down substantially.
Yes make it regulated, yes make sure people who sell it are fully trained and up to the job, but the fundamental problem is that single premium is made up predominantly of Commissions for lenders and brokers.
Take that element away and provide policies that fit the needs of the client and then you will have something worth selling.I am a former Broker, former IFA and former compliance officer, for my sins.
However, I have since seen the light.0 -
There is no reason to have single premium and that should be banned. However, the article made no reference to single premium. It was just about PPI full stop.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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