moneysupermarket.com: Findings on PPI

Commenting on the Competition Commission's findings into PPI, Stuart Glendinning, managing director of price comparison site, moneysupermarket.com, said: "You reap what you sow. The prospect of preventing lenders selling PPI at the point of sale is an immense industry change which will, in effect, slash sales of PPI. For years lenders have relied on pushy selling tactics of overpriced PPI cover.

"However, it is important for people to understand the product they are buying and the level of protection it will offer them. Data from the Competition Commission shows that between 10 and 20 per cent of people using a price comparison website to find a personal loan will choose PPI. This compares with a 40 per cent take up of PPI when people buy a loan direct from a provider, highlighting that PPI is rarely "chosen", but "sold".

"In addition to the sales falling we can expect the price of PPI to diminish as there will be significantly more competition to sell this product. This can only be good news for the consumer, however, the downside is that personal loan interest rates will inevitably rise. I expect this to happen quickly if the Competition Commission press ahead with their proposed changes - in fact, it may even happen immediately.

"The risk of this change is that many people may not take up PPI when they need it. Given the ongoing impact of the credit crunch - with the distinct possibility of rising numbers of job losses - the timing of this change may not be good."