In a letter seen by Solutions’ sister-title COVER, the FSA and OFT have updated industry recipients on the joint guidance on Payment Protection Products.
It said: “In our original guidance consultation, published in November 2011, we said we were aiming to finalise the guidance in the first half of 2012. This has not been possible.”
The email added that they were “carefully reviewing” all the submissions received and were aiming to finalise the guidance by the end of the year.
In the November guidance consultation, the FSA set out key risks including; identifying the target market for protection; ensuring that the cover offered meets the needs of that target market; and ensuring that the product does not create barriers to comparing, exiting or switching cover.
The final guidance is also expected to outline the case for the increasing growth of the short-term insurance protection (STIP) market.
The FSA noted in the November consultation paper that the Competition Commission’s remedies were designed to support its own outcome for PPI and for STIP products. And it mirrored the CC definition of STIP in the paper.
The paper also discussed how firms could manage the risks through distribution, marketing strategies and governance arrangements.
The FSA will co-ordinate responses on behalf of the joint consultation with the Office of Fair Trading; and will copy any responses received to the OFT.
