Improving industry standards regarding the sale of payment protection insurance (PPI) remains a “key priority” for the Financial Services Authority (FSA), it announced this week.
PPI claims to cover payments for products such as personal loans in the event of the borrower becoming ill or being unable to make repayments, yet it is widely seen as a poorly marketed option that is not fully explained to the consumer.
However, the FSA stated that it intends to ensure that customers are given thorough information about PPI and whether it is suitable for them.
It also aims to ensure that customers are aware of their options if they want to cancel the policy and also to advise them on the eligibility and exclusions of the cover.
Clive Briault, managing director of retail markets at the FSA, said that the intention was to make sure customers “come away from the sale having been given the best possible chance of understanding that PPI is almost always optional”.
He added that they should be made aware “what the policy will and will not cover and how much it costs”.
Recently, the FSA announced that it was to ensure mortgage firms were distributing sufficient and correct advice to potential homeowners.
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