Financial Services Compensation Scheme chief says PPI claims will carry on for years despite the bill now topping £13bn
Britain’s financial services industry has not seen the peak of claims over mis-sold payment protection insurance (PPI), the head of the UK’s financial compensation body has warned.
Mark Neale, chief executive of the Financial Services Compensation Scheme (FSCS), said PPI claims would carry on for years despite the bill already topping £13bn.
Mr Neale, whose organisation helps consumers recover money when companies become insolvent, said: “We will continue to see firms fail with PPI liabilities and it’s too early to say we’ve seen the peak.”
PPI claims handled by the FSCS are expected to jump 20pc in 2014 to more than 16,000, according to its latest budget. “[Claims] will go on for a number of years,” he said. “I can’t tell you for how long, nor can I tell you when the peak of claims will be, but typically, you have a fairly normal distribution curve over the years.”
Complaints about mis-sold PPI – marketed as a way for consumers to protect their loan repayments if they fell ill or lost their job – have rocketed since 2008. More than £13bn has been paid out in compensation since 2008, the Financial Conduct Authority said. The Big Four banks have set aside more than £20bn to compensate customers. Monthly payouts reached £735m in May 2011, and despite signs claims were falling, payouts are steady at around £500m a month.
Original source (http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/10655248/PPI-mis-selling-claims-have-yet-to-peak.html)