- Mis-Selling of Life Cover and Payment Protection Policies
The mis-selling of life insurance policies by a significant number of mortgage lenders has to be addressed by the Government. Action has been taken by the DTI, who have nearly completed their investigation into the tie in of home insurance with mortgages. An announcement barring the practice is expected very shortly.
However the investigation has been criticised by some senior figures in the industry for ignoring the selling of life cover. The criticism centers around the practice of overcharging for life insurance, whilst not offering sufficient choice of products as part of their mortgage packaging. Ray Bolger from John Charcol, the independent financial adviser, says that the DTI's knowledge of mortgages fall short of the standard required to make their investigation credible. The result being that life cover has been overlooked.
Mr Bolger believes that just as some providers have been called to account for tying building and content insurance to a mortgage, so should the sizeable number of lenders who mislead people into thinking that they have to take out life cover with their mortgage. Mr Bolger continues by saying that although lenders may not insist on customers taking out life insurance, they can be persuaded that they have no choice through being economical with the truth.
60 per cent of life insurance is sold by mortgage lenders, although it can be purchased through direct providers or independent advisers.
However a DTI spokesman has said that their investigation continues into a large range of insurance tie-ins. A lender who met Stephen Byers has said that life cover has been looked at in passing, whereas more emphasis has been placed on home insurance.
The problem of customers being forced to buy uncompetitive life cover and home insurance policies is equally important for both products.
The problems are even more acute with payment protection insurance.(PPI) Around half of all consumers who have been persuaded to take out a payment protection insurance (PPI) may have been sold the wrong product. In addition the majority of those who bought one of these controversial policies expect far more than they would actually receive if they could not pay their bills.
A wide-reaching survey has found that around 25% of people believe that they will earn a monthly income from their PPI policy, rather than understanding the policy would only cover their debts.
A further 15% said they believed the policy would cover them if they could no longer meet their repayment obligations for any reason, and 8% said they thought their medical bills would be paid if they fell ill.
Several people thought the policy would continue indefinitely to meet their debt repayments, others thought their policy would cover motor car breakdowns and household bills.
Annual sales of PPI policies are said to generate premiums of around 5.4bn for the finance industry. However a staggering 4bn of this is said to be pure profit. Studies suggest that some banks charge up to 600% more than others for similar.
The Office of Fair Trading is investigating the sale of PPI following complaints from Citizens Advice and the National Consumer Council. It recently highlighted concerns that banks are luring in customers by advertising apparently cheap loans and then hitting them with huge extra costs by selling expensive PPI as part of the deal. As a result, a loan which may appear to offer good value turns out to be far more expensive.
About the Author
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- Car Insurance Quotes are Just the Beginning
Insurance for Your Car can Get Even Lower Rates with Lifestyle Discounts for You
Car insurance quote are a great tool for finding the best car insurance companies for you. You can lower your car insurance quotes even more by searching discounts that apply to your driving lifestyle.
Car insurance quotes can narrow down your choices of insurance companies. Once you have a list of car insurance companies that can fit within your budget constraints, you can examine those companies even further by comparing the discounts insurance companies offer.
Many standard discounts on car insurance rates are taken into consideration when you submit information for your quotes. Location, the make of your car, and your gender are standard questions for quotes. However, instant quotes often neglect listing all discounts available in lieu of making the online quote process faster, and websites may also neglect to list all of the discounts that are available to drivers. Taking the time out of your schedule to search the car insurance company’s website for discounts, make a phone call, or even send an email to the company asking what discounts they offer, will further narrow down your choices of the best companies for you - and save you a substantial amount of money in the long run.
Age is highly relevant when getting preliminary quotes and when searching for discounts. A young male is likely to be subject to high insurance rates based on the statistics that show that young men are more likely to be involved in car accidents. However, discounts are offered to students with high grades, and if that same young male is in college that is a determined number of miles away from home, he may qualify for a further discount. Young men may also receive a discount from the original quotes if they participated in Driver’s Education or a Defensive Driving course. And for those that choose to settle down early, marriage offers yet another reason for a discount on car insurance, and some companies even offer a discount for being a non-smoker.
Middle age drivers will find that they can apply for the same discounts, and even more based on their driving history. Being accident free, ticket free and having a clean driver’s license are all potential traits that can lower original car insurance quotes. Many of the best car insurance companies offer discounts for having a good credit rating and carrying car and homeowner’s insurance with the same company. Insurance for you car can also be lowered through discounts offered to those who carpool to work or drive a short distance to work.
Senior drivers can have their car insurance quote lowered by even more factors. Many companies offer rate deductions based on age, membership in certain retirement programs, work status, frequency of driving, low annual mileage, and longevity with an insurance company.
Car insurance quotes are rarely the final rate. Insurance for you car can be less costly be researching the available discounts that are available based on your lifestyle and driving history. There are many more discounts available based on your car and choice of deductibles that also have the potential to reduce your quotes even more. Take time for an online search to find driver discounts that can drive down your car insurance rates. A discount on insurance for your car is a savings that you can drive around with
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- How Long Will The Current Recession Last?
While the signs of a recession have been visible for months, the fact that we are currently in a nationwide --and even worldwide-- recession is now official. And according to experts, we've been in that recession since December of 2007. This news probably comes as a surprise to no one. Many people are losing their jobs, struggling to pay their bills, and seeing their investments slip out from underneath them. Even those of us who spend much more time on internet dating sites than on financial news sites can feel the pinc
