He recently chastised providers for raising premiums and reducing cover when the likelihood of unemployment-related claims is set to increase.
PPI lobbyist Sara-Ann Burgess from independent firm Burgesses applauded his input, but suggests firmer action must be taken to clamp down on the disgraceful behaviour of credit providers who are happy to push restrictive cover onto customers when they clearly do not have their interests at heart.
She commented: “Only a couple of months ago it was announced that a number of insurers were hiking up costs by 40% and drawing up a list of sectors and professions they would not cover if redundancy occurred. Given that insurance is the delivery of a promise and policies are sold on the basis of that promise, I conclude some providers are selling under false pretences which in my view is fraud.”
The ABI reports that PPI unemployment claims are soaring - claims at the end of January reached 32,099, a 203% increase on the previous year. Lord Turner in his speech indicated that the behaviour of PPI insurers was at odds with the FSA’s principles of treating customers fairly.
He asked: “How many consumers would have taken up this cover if they had known that at the very time they needed the protection more, the price of it would significantly increase or the amount of cover decrease? This is an area where insurers must expect us to intervene to address poor consumer outcomes. And more than that they must think clearly about the impact of their actions on the sector’s reputation.”
