CML welcomes payment insurance findings

The CML welcomed publication today by the Financial Services Authority (FSA) of the findings of its review of payment protection insurance (PPI) selling standards.

The FSA found that sales of regular premium prime mortgage PPI were more likely to meet required standards, and to have been based on a proper assessment of the customer’s need for insurance.

In its thematic update on the sale of PPI, the FSA said: “Our latest work has confirmed our earlier findings that sales of regular premium prime mortgage PPI, on an advised basis, are most likely to meet our requirements. We found that the processes and controls around the selling of this specific product are likely to result in a more thorough assessment of the customer’s demands and needs when arranging protection insurance.”

Commenting on the FSA’s findings, the CML’s director general Michael Coogan said: “We have said consistently that PPI sold with prime mortgages is more appropriately targeted at customers than some other insurance products. With market conditions becoming more challenging, mortgage payment protection insurance still has an important role to play as part of the safety net providing support for home-owners.”