UK Should Put Time Limit On Bank PPI Claims - CBI Chief
November 12 2012 - 4:49AM
Dow Jones News
The U.K. government should consider setting a deadline for bank
customers to seek reimbursement for faulty payment protection
insurance, the head of the country's biggest business lobby said
Monday.
Writing in the Times of London, John Cridland, director-general
of the Confederation of British Industry, said there is a real
sense that the PPI scandal, which so far has led the U.K.'s banks
to set aside more than 11 billion pounds ($17.5 billion) for
customer compensation, is now playing into the hands of
"ambulance-chasing claims-management companies," who innundate
British consumers with text messages and phone calls inviting them
to submit PPI claims on a no-win, no-fee basis.
"I firmly believe we now need to draw a line under PPI and I am
urging the government to consider the introduction of a statute of
limitations for all PPI claims, capping the time during which legal
proceedings can be initiated," Mr. Cridland said.
"Such a move could be reinforced by the Financial Services
Authority declaring that the point at which consumer awareness of
PPI mis-selling is widely known has now been legally reached," he
said.
PPI was marketed as an insurance policy for customers on their
mortgage, loan and credit card payments in the case of sickness or
job loss. Banks started setting aside money for redress last year,
after accepting regulators' findings that many of the policies were
sold to people who didn't need them, didn't know they had bought
them or were ineligible under the terms of the insurance to receive
payouts.
Uncertainty around the final bill for the industry has weighed
on banks' share prices.
Newspaper website: http://www.timesonline.co.uk
London Bureau, Dow Jones Newswires; +44 (0)20 7842 9320
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