Shane Craig, managing director at Paymentcare, said: “Single premium PPI insurance policies are never in the client’s best interest, with MPPI being the worst offender.
“Borrowers are sold a limited period of cover, usually five years, yet they pay for this over the whole term of their mortgage. The unnecessary interest accrued is ruinous.”
Paymentcare’s range of monthly paid MPPI policies offers brokers and advisers rates of £3.80 for full ASU cover or £2.40 for disability or unemployment only cover, all on a back to day one basis.
Craig commented: “We have received a great deal of feedback from customers stating that they’ve always wanted mortgage protection in the past but felt they just couldn’t afford it. It’s vitally important that the regulators put a stop to single premium policies now in order to protect consumers.
“It’s very good news for borrowers that the pressure is now mounting against the selling of single premium policies but, as always, actions speak louder than words."
Paymentcare wrote to the Office of Fair Trading in September 2005, urging them to enforce an outright ban of the selling of single premium PPI policies. They responded by stating that the point had been proposed previously but had not been taken up by the Department of Trade and Industry thus far.
Craig added: “I simply refuse to believe that anyone would select a single premium policy over and above a monthly paid alternative if they were made fully aware of the options available.”
