Loan Protection Insurance Still Being Sold Incorrectly

Loan Protection Insurance Still Being Sold Incorrectly
Loan protection insurance came under fire in​ 2018 when the​ Financial Services Authority began an​ investigation into the​ sector following a​ super complaint made to​ the​ Office of​ Fair Trading by the​ Citizens Advice .​
It was revealed that many changes needed to​ be made to​ the​ way the​ product was sold and although some positive changes have been made a​ recent review by the​ Financial Services Authority has revealed that firms are still not making the​ product easy for the​ consumer to​ understand and is​ still being sold incorrectly.
Loan protection insurance can give you​ a​ tax free income each month if​ you​ become out of​ and unable to​ work due to​ suffering from an​ accident,​ long term sickness or​ through unemployment such as​ redundancy .​
After you​ had been out of​ work for a​ set period of​ time which can be anywhere between one to​ three months’ after the​ event,​ the​ insurance would provide you​ a​ tax free income for up to​ 12 months and with some policies for up to​ 24 months .​
Do note that there can be exclusions which could mean that the​ product isn’t suitable for all circumstances so it​ is​ essential that these are pointed out at​ the​ time of​ buying .​
Some typical reasons include being of​ retirement age,​ self-employed,​ only in​ part time work or​ if​ you​ have an​ ongoing illness at​ the​ time of​ taking out the​ policy .​

One of​ the​ many problems associated with the​ mis-selling of​ loan protection insurance and which led to​ several firms receiving fines from the​ Financial Services Authority early 2018 for was not making the​ product clear at​ the​ time of​ selling,​ poor selling techniques led to​ the​ product being mis-sold and people holding policies they couldn’t claim against .​
The majority of​ policies are bought alongside the​ loan at​ the​ time the​ loan is​ taken out with the​ high street lender but buying the​ cover this way can add hundreds more onto the​ cost than it​ needs too .​
Loan protection insurance can be bought independently of​ the​ loan and this is​ the​ best way to​ make huge savings on​ the​ premiums for what could be essential cover and give great peace of​ mind .​
The standalone specialist provider of​ loan protection insurance will always make sure that the​ consumer has access to​ the​ vital information and key facts that is​ needed to​ be able to​ make an​ informed decision regarding the​ products suitability .​
One of​ the​ biggest changes for the​ better is​ to​ come in​ March 2008 with the​ introduction of​ comparison charts,​ comparison charts will make purchasing the​ correct product easier for consumers as​ they will answer a​ series of​ questions which will then lead the​ to​ the​ correct payment protection product .​
Along with this the​ charts will show how much in​ total the​ cover will cost,​ point out the​ exclusions within them and help the​ consumer to​ get the​ best deal.
It is​ important to​ remember that it​ isn’t the​ product itself that is​ to​ blame for the​ problems surrounding payment protection but those who have poor selling techniques such as​ the​ high street lenders .​
a​ standalone specialist will know their products inside out and as​ such be able to​ give you​ the​ essential advice needed for you​ to​ make the​ right choice regarding the​ suitability of​ loan protection insurance.

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