We Introduce You

Perhaps due to a slump in sales or maybe because of customers showing concern, the Building Societies Association has issued a letter to the Office of Fair Trading (OFT) about MPPI (Mortgage Protection Payment Insurance).

This comes in light of the OFT referring PPI, including MPPI, to the Competition Commission after finding very worrying failings in the way it is sold.

The letter states “We believe that the MPPI sector is fundamentally different to the general PPI sector. This is both in terms of how the product is sold and also customers experience of the product if they have to make a claim. You identified many of these differences in your investigation into the PPI sector and we trust that the CC will, if it goes ahead with an investigation, also identify these differences.

“We note that you found that MPPI products are of better quality than general PPI products. We also note that you found the market to be more competitive than the general PPI market and that better sales techniques are used. As the market matures, we expect both existing providers and new entrants to continue making improvements to both the products themselves and also the ways that they are sold. These innovations will further benefit consumers.

“One weakness of the paper is that it fails to highlight the wide choice of different MPPI products. Although you acknowledge that MPPI can be purchased on a modular basis, you fail to recognise the differences between various MPPI products – while some policies, for example, provide just a very basic level of cover, others provide a whole range of ancillary benefits to claimants such as assistance with finding new employment. This increases not just the range of products available, but also the price of products available to consumers.”

I think in some ways it goes to show that some things prove profitable for companies and then the less scrupulous come along and exploit the market more and more.

The PPI and MPPI story is going to run and run……