Sunday, 6 May 2012

Homebuyers shun mortgage protection because of confusion over PPI scandal | Money | The Observer

Homebuyers shun mortgage protection because of confusion over PPI scandal | Money | The Observer

The scandal surrounding payment protection insurance mis-selling could deter homeowners from buying insurance for their mortgages – at the very time that rising unemployment means they need it most, lenders fear.
Mortgage payment protection insurance is designed to cover monthly repayments if a borrower is unable to work through accident, sickness or unemployment. Policies are annually renewable, and if a claim is made payouts last for a relatively short period – typically a year. About two million homeowners are believed to have policies, and research by the Competition Commission revealed that before the start of the recession 28% of premiums were paid out in claims.

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