Insurance mis-selling leaves stain on financial industry

PPI claimThe UK’s Financial Services Authority (FSA) has published the amounts paid in redress during the first six months of 2011 to consumers who complained that they had been mis-sold payment protection insurance (PPI).

Sixteen firms representing 92% of PPI complaints received in the first half of the year paid a total of £215m (€242.8m) in redress, with £102m paid out in May and June alone after the industry’s legal challenge to the FSA and Financial Ombudsman Service was dismissed.

Margaret Cole, interim managing director of the FSA’s conduct business unit, said: “The treatment of PPI complainants has left an indelible stain on the financial industry’s record. By releasing these figures we’re providing a useful measure of firms’ progress that can be tracked on an ongoing basis.

“While the amount of redress paid in May and June is unsurprisingly large in the wake of the judicial review, looking ahead we expect the amounts to vary somewhat as firms clear their backlogs while dealing with complaints as well.”

©2011 funds europe