Amidst growing criticism that PPI is hard to claim and could push people into unnecessary debt, the watchdog is to clamp down on the loan insurance sector.
“Following the work we have undertaken it is clear that many consumers are failed by PPI – insurance which gives them a poor deal and often less protection than they think,” said John Fingleton, chief executive of the OFT.
“There is limited evidence the industry is taking steps to improve the situation, but we believe they will not make major improvements to competition in the market.”
The decision has been welcomed by others, who say that PPI can often have a negative effect on those looking to engage in proper debt management.
Both consumer website uSwitch.com and the Post Office welcomed the move, with uSwitch.com adding that the action was “encouraging”.