Slow Pace of PPI Change Creates Problems for Consumers, Says Burgess
It will take at least a year for recommended changes to the payment protection insurance (PPI) market to come into effect leaving the potential for many thousands to fall foul of old problems.
Braintree, Essex (PRWEB) November 24, 2008 -- It will take at least a year for recommended changes to the payment protection insurance (PPI) market to come into effect leaving the potential for many thousands to fall foul of old problems.
Sara-Ann Burgess, MD Burgesses
Sara-Ann Burgess, a longstanding campaigner for better standards in the market and a director at specialist PPI firm Burgesses, said she was frustrated at how long change had been at coming and how slowly it was being put into effect.
"Of course I'm delighted that the PPI market is being given a much needed overhaul, but it also depresses me that it has taken so long."
Burgess said she had been campaigning for change for over a decade and in that time tens of thousands of consumers had bought into policies that were unsuitable, over-priced and poorly designed.
If action had been taken more quickly, Burgess said all of these consumers could have been protected from making these misguided purchases and the PPI market would have long since offered the products that consumers so desperately need.
"It is wonderful news that single premium policies will be outlawed and I am very happy that there will be a focus on providing a much higher level of information to consumers, enabling them to make an informed comparison about the policies they are being offered."
However she said the Office of Fair Trading had referred the PPI market to the Competition Commission back in February 2007. Prior to that Citizens' Advice had completed a long and critical report of the market and there had been numerous other pieces of research conducted by independent reviewers such as Defaqto, which had also highlighted major failings.
Indeed each and every review undertaken by the Financial Services Authority has found significant problems within the PPI sector and despite the recommendations of the Competition Commission it will not be until the end of 2009 or even into 2010 that they are put in place.
"The last 12 months have shown us how quickly things can move in the financial markets," said Burgess. "They have also shown us that where there is a will there is a way and that through concerted and focused attention, huge changes can be brought into effect very quickly. Why the PPI market has been allowed to stagnate over the years remains a mystery and the boil should have been lanced long ago."
Burgess said she hoped the focus that was now being put on creating an open market would help independent intermediaries like British Insurance, that had proved their commitment to providing excellent products to consumers, play a more prominent role going forward.
However she felt very strongly that those who had allowed the market's worst abuses to continue under their noses were held to account.
"I have known that consumers were being ripped off for many years and have tried to publicise the problems they have faced. Regulators and industry professionals have also understood the problem and yet it has been allowed to drag on. What we need is faster and more effective controls in the financial markets rather than the lumbering processes which we currently employ."
Burgess said these process may get there in the end, but that they allowed too many consumers to be unnecessarily mistreated along the way.
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