Surge in miss-sold PPI has fuelled excessive increase in FSCS levy
Complaints to the Financial Ombudsman Service (FOS) about payment protection insurance (PPI) mis-selling continue to spiral, according to new data.
The Ombudsman’s newsletter, published last week, shows the financial services watchdog received 13,520 new PPI cases in the quarter ending in June.
This figure – a pro-rata rise on 2009/10’s total of 49,186 PPI complaints handled by the service – heralds yet another increase next year in the Financial Services Compensation Scheme’s levy on general insurance intermediaries.
PPI accounted for 34% of all new cases being handled by the FOS during the first quarter, making it by far the biggest source of complaints for consumers about financial services products. The number of new PPI cases for April to June alone outstripped the total for the whole of the year ending March 2008 (10,652).
The dramatic upsurge in complaints about PPI mis-selling has fuelled this year’s explosion in the FSCS’s intermediaries levy, which has sparked Insurance Times’ Fair Fees campaign. Biba head of training and compliance Steve White said: “These latest figures underline the urgent need for the FSA to separate the professional insurance broker from the secondary sellers as part of their fundamental review of the FSCS.”