The timetable for a ban on payment protection insurance being sold alongside loans has been set, with the measures likely taking effect on April 2012.
The Competition Commission says it will carry out a 30 day consultation later this year and expects to issue a formal order early in 2011. Under the planned timetable, from October 2011 all companies would have to supply details of their policies to organizations such as the Financial Services Authority to allow for price comparison tables. This date would also bring the introduction of rules to make advertising and marketing of policies clearer and easier to understand.
Then, from April 2012, it would no longer be allowable to sell policies at the same time as issuing the relevant loan. Instead there'd be a cooling off period to allow the borrower to consider whether to take out a policy and who to get it from.
There would also be a complete ban on policies where the customer paid with a single premium. Officials believe that system allows too little room for customers to change their minds later on, or ditch PPI if their circumstances change.