Lloyds TSB has announced changes to the payment protection insurance (PPI) it offers to customers with unsecured loans.
PPI is taken to insure against the possibility of a borrower becoming unable to meet repayments and the lender has noted an increase in claims.
According to Lloyds TSB, unemployment claims have risen by 100 per cent since January.
It is now replacing its single premium PPI policy - which saw the cover added on to the price of the loan - with a regular monthly premium, meaning customers no longer pay interest of the amount owed.
Commenting on the move, manager director of Lloyds TSB customer banking Ian Larkin remarked: "We want to continue to do as much as we can to support our customers in this difficult climate ... Spreading the cost of PPI makes it accessible and affordable for more customers."
The Competition Commission recently proposed a ban on single premium policies.
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