Staggering £1.4 billion overcharges in Payment Protection Insurance market each year
Sinn Féin Economy Spokesperson, Mitchel McLaughlin MLA (South Antrim) has called for greater transparency in the Payment Protection Insurance (PPI) market after the Competition Commission found that consumers are being overcharged by £1.4 billion each year.
Mitchel McLaughlin said:
"It is very worrying that the Competition Commission said that the lack of competition in the PPI market, which is supposed to protect creditors who through illness or loss of employment are unable to continue with payments is resulting in higher than reasonable premium charges.
"The Competition Commission found that consumers are being overcharged by the staggering amount of £1.4 billion each year for Payment Protection Insurance. I concur with their call for consumers to be given better information on PPI, which is normally additional to credit card or loan agreement payments. Credit Companies and Banks don't always explain in clear and transparent terminology the cost of such protection. By adding PPI to repayments, even though the capital amount of the loan decreases annually, most consumers are unaware that PPI charges are based on the original sum borrowed.
"I feel it is very important that lending institutions should be required to make all aspects of a contract clear, including exactly how much PPI costs over the entire period of the contract. Consumers should also be made aware that they have the right to shop around independently for the best rate for PPI." ENDS