Every PPI comparison was wrong - either because the policies are no longer available or the premiums are out of date. People will be seriously misled if they rely on the FSA's tables and this is very concerning, given it's an organisation that's supposed to be acting in the interests of consumers.
Braintree, Essex (PRWEB) February 16, 2009
The Financial Services Authority is not following the Competition Commission's recommendations to give consumers clear and up to date information on Payment Protection Insurance says PPI lobbyist Sara-Ann Burgess.
"It's PPI comparison tables list providers who no longer offer cover and detail premiums that are inaccurate," she says. "Given the Commission has entrusted the FSA to provide data to consumers to help them make informed decisions about purchasing cover, I believe they're letting all their stakeholders down."
Sara-Ann's comments follow her own investigation into what consumers will be faced with, if they use the PPI tables to shop around for cover. She recently posed as a 24 year-old looking for a £1000 a month payout for her mortgage should unemployment occur and was taken aback at the results.
"Every PPI comparison was wrong - either because the policies are no longer available or the premiums are out of date. People will be seriously misled if they rely on the FSA's tables and this is very concerning, given it's an organisation that's supposed to be acting in the interests of consumers."
Financial data specialists Defaqto are charged with researching and collating the material and Sara-Ann suggests tighter controls need to be in place to ensure their information can be trusted.
She continues, "There's a clear problem with data verification on both sides and a mechanism needs to be in place to address this. The Commission is calling for all PPI distributors and intermediaries to provide premium costs per £100 of benefit, plus supporting information, to the FSA by April 2010, but what confidence will they have if it's incorrectly presented?"
"It's not correct now and this is with a much smaller sample of data. These inaccuracies serve to undermine the confidence of providers and consumers and they need to be rectified immediately," she says.
In its January report, the Commission outlined a package of measures which were designed to introduce competition in the PPI sector and so ensure customers are treated more fairly by providers and have access to a broader range of information. A seven day ban on lenders offering PPI at the time of the credit provision was to give customers time and ability to make an informed choice and other providers a chance to compete more effectively.
However, Sara-Ann believes the PPI tables do not allow consumers to make an informed choice and neither do they allow providers to compete effectively. She concludes, "At the moment, consumers will become increasingly frustrated if they contact the companies listed on the tables. They'll either not be able to buy the cover detailed, or if the provider does still exist, will be irritated to find the actual premium bears no reflection to what was presented. It's creating more hassle rather than simplifying the process and I strongly suggest the FSA takes its data providers to task."