PPI successful claim rate a miserable 11%
by Gill Montia
Story link: PPI successful claim rate a miserable 11%
Which? is cautioning consumers against taking out payment protection insurance (PPI) in the current economic climate.
Spokeswoman for the consumer group, Lucy Widenka, says that some sales practices for PPI, already identified by the Financial Services Authority as unsound, coupled with the economic downturn, mean that independent advice should be taken when purchasing PPI.
Ms Widenka stresses that the advice should be based on the protection needed to cover a consumer’s entire financial situation, and not just one debt.
According to Which?, the success rate for claims on PPI is a miserable 11% and most PPI holders would be better served spending their money on more comprehensive cover, such as income protection.
An earlier report by the consumer watchdog found that hundreds of thousands of Britons have bought PPI because they were under the impression that their applications for financial products would be more likely to be accepted if they opted for the insurance.
According to the watchdog’s latest research, over 9.8 million people in the UK have PPI for credit card debt alone.