Repossession Figures Highlight PPI Need
Whilst there has been much media attention surrounding missold Payment Protection Insurance (PPI), repossession figures having revealed just how important the protection product can be. The Building Societies Association (BSA) showed that only 16 per cent of those experiencing repossession had insurance, resulting in the overall majority being very vulnerable to home loss.
Mortgage PPI can be vital for some, and in the event that they lose their jobs and cannot make loan repayments, insurance can provide the vital funds necessary to keep a roof over their head. However, the misselling scandal has put a negative tint on the industry, making many consumers wary of the protection products.
In the 1990s, mortgage PPI was actively promoted as Britain saw an increasing number of individuals taking to the property ladder. A reduction in state benefits also made PPI even more important for families to safeguard their homes. However, the take-up of the insurance product has not been as high as the BSA would like, with their report calling for the government and industry to take action and ensure that homeowners have legitimate insurance to offer support should they need it.
In particular, the BSA is asking that brokers take the time to explain the differences between mortgage PPI and more general PPI products, allowing consumers to take out a specific product that will cover their home and not double up currently held policies. Moreover, whilst the misselling scandal continues, protection of homes should be a priority.