Biba backs FSA on PPI

The British Insurance Brokers’ Association has offered its support to the FSA's request for all firms still selling single premium Payment Protection Insurance with unsecured personal loans to withdraw the product.

BIBA chief executive Eric Galbraith, said: “We fully support and welcome the FSA’s move to withdraw the sale of single premium payment protection insurance (PPI) with unsecured loans. Single premium loan protection sold by lenders has proven to be bad value in many cases, so this news is excellent for the customer.”

“PPI however is a useful product, and consumers need to assess if it is suitable for their individual requirements and need to be aware that wider cover is available, and often cheaper, from providers other than from where their loan was purchased.

“I strongly recommend that individuals looking to purchase this valuable cover contact an insurance broker or intermediary who specialises in PPI rather than choose a policy which is tied to a specific loan.

“Customers need to fully consider all their protection needs and seek advice from a broker regarding their protection priorities, and budget accordingly. Firstly to meet their immediate financial commitments in the short term should they suffer a change in circumstances such as redundancy, as well as considering their longer term needs in protecting their dependents in the event of death or long term sickness.”