In its consultation document into the PPI market, the CC indicated that it had reservations about PPI, with the cost of the product, on some occasions, higher than the interest paid on the loans. It also suggested that the level of competition within the PPI market would be investigated.
Announcing the initial findings, Peter Davis, inquiry chairman, said: “After examining a substantial amount of evidence, we think there are some areas we need to explore further. We are far from making up our minds, but we are focusing on the amount of competition for PPI that distributors face at the retail level.”
Nick Starling, director of general insurance and health at the Association of British Insurers, welcomed the findings. He said: “We are pleased that the CC is investigating this thoroughly and has found healthy competition between insurers and those companies who both underwrite and sell PPI. The Financial Services Authority has repeatedly said that PPI is a valuable product. With total borrowing in the UK of £1.4 trillion and increasing by £373 million a day, consumers need financial protection more than ever.”
The CC admitted that it had visited 11 PPI suppliers as part of its study and welcomed any further feedback prior to the 27 November consultation deadline.
get the daily news delivered to your inbox
download our news ticker
find the latest industry jobs
