PPI provider offers 30% commission

This is a 10% increase on its usual commission rates for intermediaries transfering policies from other providers to Paymentcare.

This comes after redress paid by banks to consumers who were wrongly sold PPI hit £1bn in December in the wake of the PPI mis-selling scandal.

The provider also announced it was giving a ‘cast iron trail commission’ guarantee which will apply to the life of the policy even if the broker has retired from the industry.

Paymentcare already pays 28% commission on mortgage PPI and buildings and contents insurance business, and 20% commission on short-term income protection, or 22% to brokers transferring clients from rival providers.

Shane Craig, managing director of Paymentcare, said: "I urge all brokers to be pro-active and to seek out the best deals for their clients and re-broke.

"Obviously brokers will only do this if they can justify it was in the customers best interest and in line with TCF."

Ian Gray, mortgage manager at Largemortgageloans.com, said that 10% uplift in commission will not make much of an impact on broker earnings.

He said: “The average commission that a GI provider pays a broker is around 25 to 30%. The 10% enhanced commission is only going to make a difference to those brokers who put through large volumes of GI to their clients.

“A lot of brokers sell GI when someone is buying a property but as this commission applies to re-broking a policy from another provider, it’s in the policy that the offer would not apply. I guess if some brokers are really scratching around for extra income they might dig into their archives and try to re-broke old policies that they sold with other companies but I would question whether that time would be better spent writing a £200,000 mortgage instead.”