The Competition Commission is standing by and letting millions of consumers waste money on inflated Payment Protection Insurance (PPI) premiums, claims a leading independent insurance provider.

Simon Burgess from British Insurance believes that the Competition Commission, the independent public body which conducts in-depth inquiries into mergers, markets and the regulation of the major regulated industries, is not doing enough to combat misselling of Payment Protection Insurance (PPI).

The Office of Fair Trading (OFT) referred the PPI market to the Competition Commission in February this year.

The OFT believes that features of this sector are preventing, restricting, or distorting competition and thereby harming consumers. An independent report on the PPI market by financial research company Defaqto in February revealed that too many customers are either unaware that they can shop around for PPI, or do not know where to go for alternative quotes. (Read more: PPI complaints ‘could run into tens of thousands’).

“There’s evidence of high pressure and unfair sales tactics, and claims administration is slow and unfair leaving consumers facing additional charges or serious debt enforcement action,” comments Burgess.

“I’m astounded the Commission isn’t moving more quickly to prevent consumers being ripped off and suffering financially.”

According to the Competition Commission’s own timeline, there is a further four months to go before the commission releases its ‘thinking’ document.

“This will no doubt repeat the OFT’s findings and tell us what we already know,” continues Burgess.

“Questionnaires, hearings and requests for submissions are all very well, but they will not protect consumers now. Enough research has been carried out, so why has the Commission set a deadline for February 2009 for the implementation of remedial measures? This is unacceptable.”

Burgess went on to sight a ‘worrying’ recent report from consumer group Which? claiming that many consumers obtaining loans over the phone or internet are being tricked into buying PPI cover.

More than half the quotes researchers received over the phone for loans automatically included PPI cover and well known providers such as Lloyds TSB, Natwest and Tesco did the same online.

“What more evidence does the Commission need? There have been calls for this practice to be outlawed and yet consumers are still being allowed to fall victim to it,” he concludes.

Commenting on the report from the Financial Services Authority (FSA) on the progress made by financial companies in implementing processes for treating customers fairly,
Dominic Lindley, personal finance campaigner, Which?, believes far more should be done.

“The fact that a sizeable number of companies have still not put processes in place to ensure that they are treating customers fairly is a real cause for concern,” he said.

“People will still be buying financial products over the coming months and these results show there is a real chance that they could unwittingly visit a company which isn’t up to scratch.”