Britain to shake up retail credit insurance market

Companies will have to wait seven days to sell payment protection insurance (PPI) to any customer who takes out a credit agreement from next year, Britain's competition watchdog said.

The Competition Commission also said on Thursday it would ban single-premium PPI policies and require sellers to provide more information, in a bid to make consumers more price aware.

PPI has long been a bugbear for consumer bodies, who have argued companies get away with charging high prices because they face little or no competition.

The Competition Commission agreed in its final report into the matter, noting the vast majority of 12 million PPI policies in Britain had been sold at the same time as a credit agreement.

"To address the lack of competition, the CC will be introducing a package of measures to introduce competition in the market," the commission said.

PPI providers will have to state the monthly cost per 100 pounds of monthly benefit. PPI covers repayments on credit products if the borrower is unable to make repayments due to accident, sickness, unemployment or, in many cases, death.