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FSA LATEST GUIDELINES ON PAYMENT PROTECTION INSURANCE WELCOMED BY INDEPENDENT PROVIDER PAYMENTCARE.CO.UK

FSA LATEST GUIDELINES ON PAYMENT PROTECTION INSURANCE WELCOMED BY INDEPENDENT PROVIDER PAYMENTCARE.CO.UK - FULL CONSUMER REDRESS LONG OVERDUE, SAYS DIRECTOR SHANE CRAIG

AS THE Financial Services Authority publishes new guidelines for companies which sold payment protection insurance to consumers who may have been missold a policy but have not yet complained, Paymentcare.co.uk managing director Shane Craig welcomed the initiative.

"High Street lenders in particular made substantial profits from selling PPI to people who did not need it and could not claim on their policies even if they needed to; part of the problem was the fact that policies were sold at the time when loans were taken out, with customers not given the chance or opportunity to reflect on what they were buying.

"Hopefully these new guidelines will clarify the situation even further and open the door for consumers to put in a claim if they feel they were missold the cover," he said.

"One route consumers should absolutely avoid going down is to contact the so-called claims management firms, many of which have sprung up on an opportunist `no win, no fee' basis.

"If there are any issues in obtaining due refunds from lenders, then consumers have the option to contact the Financial Ombudsman Service.

"We have long campaigned against the bullying tactics used by High Street lenders to drive people into taking out PPI insurance - often when they did not have a hope of claiming on it.

According to the new guidance, banks and other sellers of the cover contacting customers should make it crystal clear that the communication contains important information and should be read carefully.

It must also state that the specific failings that led the firm to believe the customer may have been missold - and that they may have suffered financial loss and may be entitled to redress.

The FSA has also reiterated its stance on when a complaint can be considered "time barred". Customers have six years from a sale to complain or, if later, three years from when they became aware that they had cause for complaint.

"This is a welcome window of opportunity for consumers - there is clearly a lot more to come out in the wash, but we would like to think that there is still a place for this important cover when it is sold correctly to workers whose circumstances are such that back up cover to help pay the mortgage or simply get by day to day if they lose their jobs or get ill is crucial," added Craig.