The Financial Services Authority (FSA) and the Office of Fair Trading (OFT) have joined forces to help prevent the problems associated with payment protection insurance (PPI) recurring in a new generation of products.
The FSA and the OFT are consulting on proposed guidance to firms in relation to payment protection products - which can fall within either regulator's remit. This is a key time as the market shifts away from PPI and firms begin to develop new products or product features - such as short-term income protection, or debt freeze or debt waiver as elements of a credit agreement or mortgage
Payment protection products within the FSA's jurisdiction
The FSA's guidance stresses that firms should ensure that product features reflect the needs of the consumers they are targeting. There are four key areas of concern that providers should think about carefully:
firms not properly identifying the target market for the protection product
the protection not reflecting the needs of the intended consumers
the benefit of a successful claim not matching the needs of the claimant, and
product features or pricing structures creating barriers to comparing products, exiting a policy or switching cover.
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his is a key time as the market shifts away from PPI. Best PPI Advice
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