Companies emerged as falsely selling PPI under the facade of IP, shows list
A number of insurance companies have been accused of confusing payment protection insurance (PPI) and income protection (IP) on their websites. In a list given to COVER, 20 companies are listed offering PPI policies under the name of IP.
Among the list are moneysupermarket.com, Churchill, Burgesses, myfinances and simplyfinance.
Moneysupermarket.com's site says: "On the downside, the main negative point associated with income protection is how much it costs. The policy (regularly referred to as 'payment protection insurance' in this instance) is usually sold alongside a loan or credit card."
When contacted, the site responded: "Moneysupermarket.com is revising the protection channel to make it clear what type of protection consumers are searching for. We pride ourselves on having a user friendly website."
Alan Lakey, principal of Highclere Financial Services, who compiled the list, said: "My view is that any company that sells an inferior product and dresses it up as a good policy by using the name of a good one is misleading the public. The insurance companies doing this are selling mongrels as pedigree animals."
Burgesses' site says: "An income protection UK policy is designed to pay you an income typically for a period of 12 months to a maximum of 24 months."
Later, it adds: "Income protection insurance is different to income protection insurance cover. The former is a protection insurance policy that offers longer-term cover (ie not the typical 12 - 24 months' cover offered by the normal payment protection insurance plans) in the event of the policyholder being unable to work due to accident or sickness."
Simon Burgess, managing director of British Insurance, admitted some of the wording on the Burgesses website is confusing. He said: "It is not a consumer site because it is designed to produce customers for British Insurance.com. The purpose of Burgesses is to boost power in the search engine for British Insurance. It is confusing but it is deliberately so."
He added: "The only thing we do is short-term IP. We've been calling what we do IP for 30 years, before, when people were on permanent health insurance, we called it IP. The definition of the product has changed but we were there first."
Robin Gordon-Walker, spokesperson for the FSA, said: "Our general position is that all financial promotion advertisements should be fair, clear and not misleading."
