February 12, 2020 / 12:06 AM / 5 days ago

Loan insurance complaints in Britain jumped in late 2019

LONDON (Reuters) - Complaints about loan insurance ballooned in the final quarter of 2019, spurred on by British regulators setting an end of August deadline for compensation claims, the Financial Ombudsman Service said on Wednesday.

FOS said it received 41,500 complaints about payment protection insurance or PPI, a 72% increase on the previous three months.

The Ombudsman hears complaints from consumers who feel they have not had proper redress from the banks or other firms that sold them the loan insurance.

FOS said it has now received over two million PPI complaints spanning nearly a decade in what is already Britain’s costliest retail financial scandal, with banks having paid out more than 40 billion pounds in compensation.

FOS upheld 17% of PPI complaints in the last three months of 2019, a figure that has declined as banks apply FOS guidance on handling complaints.

“There has never been another complaints issue on the same scale as PPI, and the volumes of complaints made to financial businesses around the deadline last August were truly unprecedented,” FOS Chief Executive Caroline Wayman said in a statement.

“We are pleased that most businesses are now following our well-established approach and paying compensation right away.”

Reporting by Huw Jones; editing by David Evans

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