roviding you take the time adding cover to loans. Often when
to read the terms and the protection is bought this way
conditions that come with a interest is added onto the loan
policy then loan cover can be a after loan protection has been
valuable asset. It is only when included, which means you are
the consumer is ignorant of the paying interest on the actual
exclusions and buys cover that protection and loan combined and
has not been explained fully that not just the borrowing itself.
problems occur. This was seen in
2005 when the Office of Fair
For the cheapest quotes for
Trading received a super payment protection insurance go
complaint from the Citizens’ to a specialist independent
Advice Bureau. Following this, provider. As they are more
the Financial Services Authority ethical, the quote given for
began investigating and protection for your loan or
subsequently handed out fines to credit card will be based on your
several firms. age when applying and how much
Guidelines were laid down when it your monthly loan repayments are.
came to improving sales By choosing to take out loan
techniques and while some firms protection this way you can save
took heed and have made changes as much as 80% when compared to
to the way they sell cover, many high street lenders’ quotes.
more are still failing to meet
Along with making huge savings
expectations and mis-selling on the cover a specialist will
continues. The majority of also ensure that the consumer has
mis-selling occurs when policies access to the information needed
are sold alongside loans at the to ensure the suitability of the
time of borrowing. High street protection. Policy exclusions
lenders are thought to bring in stop some people from being
around £4 billion in profits from eligible to claim, and so
checking your circumstances is just one type of product.
against the exclusions is However, in March consumers will
imperative. Failing to properly have another tool they can use:
explain exclusions is the number comparison tables. Tables will
one cause of mis-selling. show how much a policy would cost
Popular exclusions include in total, and explain the
working part time, being exclusions that exist in all
self-employed, suffering from an cover. When it comes to choosing
ongoing illness or being of which type of policy would be the
retirement age. While these are most suitable then this will be
listed as exclusions even those made more transparent through a
who have an illness could still series of questions and
be eligible to take out a policy. answers.
Providing the illness has not
re-occurred within two years
essential to go over the terms align="center">
and conditions with a fine
toothcomb.
A specialist is the best way type="text/javascript">
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About the Author:
Simon Burgess is Managing Director of the award-winning British Insurance, a specialist provider of loan cover, mortgage protection insurance and income protection insurance.
Article Tags: policy, protection, time
