Companies that are still selling single premium payment protection insurance (PPI) alongside unsecured loans have been urged to stop doing so.The Financial Services Authority (FSA) has written to firms making the request, following the Competition Commission's (CC) decision to ban the product from October of next year.PPI is often offered to protect against the possibility that consumers become unable to repay unsecured loans, but the CC found that single premium policies - which add the cost on to the loan itself - are unfair.And managing director of retail markets at the FSA Jon Pain urged providers not to wait until the ban comes into effect, but rather cease selling by the end of May at the latest."We believe that PPI can play an important and legitimate role to cover repayments on specific credit agreements for consumers facing job loss, or other issues at this difficult time," he wrote, although he added that there is concern over how products are sold.The CC announced the ban last month, noting that consumers are often unaware that they can carry out comparisons to find the best PPI deal.
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