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Daily Insurance Industry News
Wednesday 26th of September 2018
August 20, 2007

Nationwide bans PPI sales

by Gill Montia

Story link: Nationwide bans PPI sales

Nationwide bans PPI sales

Nationwide, the UK’s largest building society, has ceased all sales of Payment Protection Insurance (PPI), after admitting that its staff have not been advising customers properly.

The building society apparently mounted a covert operation and discovered its PPI sellers were not up to the mark.

PPI is sold alongside loans, mortgages and credit card agreements, to provide borrowers with protection against periods of ill health or redundancy, which could mean they can not meet their repayments.

In recent times PPI has received a bad press, with accusations that it has been widely mis-sold and that many consumers buying the insurance thought they were buying benefits for which they were not actually eligible.

The Nationwide’s decision to stop selling PPI comes at a time when the Financial Services Authority is close to completing a two-year investigation into this type of insurance.

A report is due to be published in September of this year and is expected to recommend wide ranging changes in the PPI sector.

Nationwide’s PPI policies are underwritten by Norwich Union and Cardif Pinnacle, part of BNP Paribas group.

The area of business is not a major source of revenue for the building society, but this is not the case for many High Street banks.

 

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