PPI continues to divide opinion

Speaking on the debt-repayment insurance, Mike Naylor from Which? said that there are few benefits in taking out PPI.

“It is of little benefit. It is very costly. It adds significantly to the cost of the loan. It is not suitable for those who are on contracts or are self employed or have pre-existing illnesses,” said Mr Naylor.

However, Defaqto’s Brian Brown said that if people know what they are getting into, PPI can be useful.

“[PPI] can provide valuable cover, but they are not for everyone. PPI policies are often complicated and can be expensive, so buyers should make sure they understand what they are getting for their money before they commit themselves,” he warned.

Debate over the usefulness or not of the loan insurance comes as the Office of Fair Trading investigates the industry ahead of making recommendations about it.