Loan Payment Protection Insurance from Ł2.50 per Ł100 of cover
Click Here to get a quote for Loan Payment Protection Insurance that covers loan payments or loss of income due to accident, sickness or redundancy from British Insurance Ltd

Why pay up to 3 times more than you have to?

For Simon Burgess, managing director of Braintree, Essex-based British Insurance, FSA criticism vindicates his long campaign against the excess profiteering by the big banks, at the consumers expense: as an independent broker, he sells Loan Payment Protection Insurance for about a third of prices charged by major providers.

On a Ł7,500 loan over five years with a monthly repayment of just over Ł147, Burgess's recent survey uncovered additional loan payment protection insurance charges ranging from Ł21.03 at Nationwide and Ł21.06 at Abbey - up to Ł59.85 at Bank of Scotland. loan payment protection insurance policies from Burgess's brokerage, giving similar cover, cost Ł11.05.

Over five years this gulf produces an average saving of Ł1,450. Says Burgess: 'The main abuse of loan payment protection insurance premiums is on personal loans, although there is a massive rip-off too on protection sold on credit card debts. Less than 1% of premiums paid are effectively returned to claimants, while most of the money goes direct into retailers' pockets.

'Even consumers who realise they have a choice of loan payment protection insurance providers have little chance of avoiding uncompetitive deals. Banks use high-pressure sales techniques to tell customers that if they don't take the loan protection, they won't get the loan - though better policies are available elsewhere for a tenth of the cost.'

Loan Payment Protection Insurance

Extract for the Observer newspaper on Sunday December 18, 2005

Is this a protection racket?

High-street banks offering customers personal loans are consistently quoting repayment figures that include the controversial loan payment protection insurance , which adds thousands of pounds to the cost.
An Independent payment protection insurance broker carried out a mystery shopper loan payment protection insurance exercise at the end of last month on five big name banks: Northern Rock, Lloyds TSB, Halifax, Egg and NatWest.

In each case, it says that its team of shoppers were quoted a figure inclusive of loan payment protection insurance on the requested Ł7,500 loan over five years. In the case of NatWest, this would mean an additional Ł2,562 over the life of the loan.

The Office of Fair Trading announced last week that it is launching an inquiry into the sale of loan payment protection insurance following a 'super complaint' about the product lodged by Citizens Advice. A recent Financial Services Authority investigation found that people were frequently being sold cover they could not claim on or which was limited, and that firms were failing to give adequate advice about the product.

'The lenders covered in this mystery shop are guilty on two fronts: first, by giving the first quote with loan payment protection insurance, as it is an inflated figure and not one that the consumer would necessarily want; second, they have all omitted to establish the eligibility of the applicant before doing a hard sell on the loan,' said Shane Craig, managing director of Paymentcare.

Loan Payment Protection Insurance

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

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