PPI Sector Full of Hot Air Says British Insurance

The Government and stakeholders in the Payment Protection sector are ineffectual and sluggish when it comes to helping cash-strapped consumers meet their mortgage and loan repayments, says Simon Burgess from independent PPI provider, British Insurance.

(PRWEB) May 9, 2008 -- The Government and stakeholders in the Payment Protection sector are ineffectual and sluggish when it comes to helping cash-strapped consumers meet their mortgage and loan repayments, says Simon Burgess from independent PPI provider, British Insurance.

British Insurance

Lenders are in no hurry to put their house in order, so the Government must step in and implement solutions now!

He comments: "In January, the Ministry of Justice published a Consultation Paper introducing a package of measures to assist the over-indebted. It proposed to grant consumers a 12-month amnesty on debt repayments, but responses are still being considered and next steps won't be decided until later this year.

"There's no sense of urgency about helping the millions without the financial safety net of payment protection insurance and given the Government usually takes years before implementing anything, I fear struggling consumers will be left to fend for themselves."

A view borne out by the Joseph Rowntree Foundation who in response to concerns that at least 80% of homeowners are without PPI, recently recommended Government and Lenders adopt a Sustainable Home Ownership Partnership Scheme.

The compulsory Scheme would cover 10 months worth of mortgage payments should a first time buyer or person remortgaging suffer accident, sickness and unemployment and premiums will be split between Government (25%), the Lender (25%) and borrower (50%).

Burgess continues: "Millions of homeowners would be able to afford this cover, but as yet, there's little appetite for interested parties to even begin to discuss the options. I recommend this Scheme is open to all borrowers and not just first time buyers and those remortgaging.

"A round table discussion is planned, but even the Foundation admits this is a long term solution and envisages years before borrowers see any benefits. In the meantime, there are swathes of consumers without payment protection who may be unable to meet their loan repayments and even those who do have cover, in the majority of cases, are getting a raw deal from their lender."

He concludes: "At least my PPI is the most competitive on the market, for cover and premiums, and goes some way to helping borrowers meet their obligations in times of hardship. It's pitiful that there's so much talk and so little action -- a classic case of hot air. Even the Competition Commission's deadline for when this sector has to clean up its act and stop ripping off consumers isn't until February 2009, two years after it was first asked to investigate.

"Lenders are in no hurry to put their house in order, so the Government must step in and implement solutions now!"

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