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Campaign gets Balls’ backing

Political support for Money Marketing’s No Advice, No Protection campaign is gathering momentum after the Economic Secretary to the Treasury voiced his concerns on insurance sales to MPs.

New secretary Ed Balls has written to the Labour MP for Battersea, Balham and Wandsworth Martin Linton expressing the need for distinctions to be made between advised and non-advised sales of insurance policies.

Balls’ letter echoes the concerns of his predecessor Ivan Lewis, who wrote to Treasury Chief Secretary Stephen Timms to outline the steps the FSA is taking on payment protection insurance to ensure the fair treatment of customers.

The letter also explains that the FSA is undertaking a review of general insurance products and it will be considering whether consumers buying protection on a non-advised basis get enough information to make an informed decision.

The FSA is trying to ensure that firms selling protection insurance do not make inappropriate sales and that consumers understand the key features of a policy, including significant exclusions and the status of the service before buying protection products.

Balls says he is pleased that people are taking personal responsibility for their financial decisions but says that certain requirements must be set out in the area of non-advised sales.

He says: “The FSA will look at whether its rules provide appropriate consumer protection in the case of non-advised sales of protection products.

“If the regulator concludes that changes are needed, it will consult publicly on the amendments.”

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