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Giving payment protection a bad name

I find the headline ‘Bye Bye PPI’ (Money Marketing, 1 October) and much of the subsequent article highly misleading and in danger of tainting a very valuable insurance cover, namely mortgage payment protection insurance.

It is true that the FSA continues to find failings in the sale of loan and credit card PPI and it has stated it wants to see the end of single premium PPI sold alongside personal loans. But that is just one element of a whole range of available cover.

In particular, the tone of the MM article may give the impression that MPPI and regular premium PPI is subject to the same difficulties as single premium PPI. Nothing could be further from the truth. MPPI is a quality product with robust sales practices and this is more important than ever in the current economic environment. Indeed, the FSA acknowledged this in a recent review.

Intermediaries need to be aware that the two kinds of PPI (ie single and regular premium) are vastly different and must be confident in recommending products that meet their clients’ needs. While MPPI remains inextricably linked to the mortgage market, growth in take-up will continue to be held up by public’s incorrect perception of poor value and bad sales practices.

The media’s negative focus on the well-documented problems in the PPI market helps to reinforce this. Stories such as that cited above fail to clearly communicate the different types of PPI available. Only knowledgeable advisers can counter the fallacy that all payment protection is bad and ensure their clients are confident that MPPI is a valuable product that will ultimately help them keep their home.

In fact, not making clients aware that there is insurance available that will cover the cost of their mortgage should the worst happen may be in breach of the TCF guidelines.

Sandy McPherson

Head of marketing,



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