The Office of Fair Trading, on 7 February 2007, referred the supply of PPI to non business customers in the UK to the CC. The subsequent CC investigation found that the vast majority of policies are sold at the same time that consumers take out loans or other credit and that consumers rarely shop around or switch PPI providers. The CC concluded that the "point of sale" advantage and the absence of competitive pressure meant that PPI providers could charge high prices for their products.
On 5 June 2008, the CC issued a Notice of Possible Remedies, inviting comments on the actions the CC might take to remedy, mitigate or prevent the adverse affect on competition it had identified. Following its analysis and consideration of responses to that notice, the CC published the Provisional Decision on 13 November 2008. It contains the following proposed package of remedies:
- a prohibition on the active sale of PPI by a distributor to a customer within 14 days of the distributor selling credit to that customer;
- a requirement on all PPI providers to provide certain information in PPI marketing materials, and a requirement on distributors to advertise personal loan PPI and second charge mortgage PPI in close proximity to their respective personal loan advertisements;
- a requirement on all PPI providers to provide certain information on PPI policies to the Financial Services Authority (FSA);
- a recommendation to the FSA that it uses the information provided to it by the PPI providers to populate its PPI price comparison tables; and
- a prohibition on the selling of single-premium PPI policies.
The CC is proposing a 12 month transitional period for PPI providers to implement all of the proposed remedies but expects that some elements can be introduced sooner.
The deadline for submitting views on the CC's Provisional Decision and its underlying analysis is 4 December 2008. The final report is currently scheduled for mid January 2009.
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