Grant Ellis says guidelines on PPI mis-selling go too far in favour of the complainants
The FSA has been accused of moving the goalposts over how it handles payment protection insurance (PPI) complaints.
In his column in this week’s Insurance Times, Broker Network chairman Grant Ellis criticises the watchdog over its new guidelines for assessing and redressing PPI mis-selling cases.
In a recently published document, the regulator says mis-selling will have occurred if brokers have not taken “reasonable care” to ensure that policies were “affordable in light of the customers’ income and outgoings”.
Ellis argues that it will prove difficult for brokers to assess whether customers can afford products without an extensive examination of the latter’s personal circumstances. “Unfortunately, the FSA and its predecessors have form when it comes to moving the goalposts in favour of complainants,” he wrote.
“If this is part of the measure that the FSA is advising the Financial Services Compensation Scheme to use when assessing alleged PPI mis-selling, it is no wonder that 89% of complaints are upheld.”
The upsurge in PPI complaints has fuelled the eightfold increase in this year’s FSCS levy, which has sparked Insurance Times’s Fair Fees campaign to reform the way the compensation scheme works.
An FSA spokesman said brokers should always have adhered to the terms laid down in the guidance.