Letter of the month

I've criticised the Financial Services Authority and other bodies, in the past, for producing a stream of review documents and not doing anything tangible to address the payment protection insurance mis-selling situation.

However, its recent £445,000 fine of Loans.co.uk does indeed show it has some 'teeth'. The FSA investigation found the firm failed to gather and record information to show that the policy recommendations it made were suitable and customers did not receive enough information at the point of recommendation to make an informed decision.

It was only a matter of time before a fine like this was enforced. Many PPI providers, such as errant High Street banks/building societies and a few rogue traders like Loans.co.uk, do not treat customers fairly and it is their actions that impact upon more honourable brokers who do.

With PPI coming under closer scrutiny and consumers beginning to realise they may have grounds for compensation, some providers will not want to continue to sell PPI. It's becoming too hot to handle.

Brokers have a duty of care to ensure clients have sufficient funds to pay their mortgage in the event of an accident, sickness or unemployment, but not all are keen to do so. I urge brokers not to ignore PPI provision for clients, those who do could leave them wide open to financial hardship. It is wise to replace volume with caution, but do not neglect those who need this cover most.

Providing the TCF guidelines are followed, brokers have nothing to fear. Brokers who choose not to sell PPI when there is a client need could end up in the same situation as those who sell it irresponsibly - being reprimanded for not treating customers fairly.

Simon Burgess, Managing director, Britishinsurance.com.