Payment Protection Insurance (PPI)
The FLA supports the use of products that help to protect consumers from going into unaffordable debt. PPI is a good example of such a product.
PPI is designed to help consumers pay their debts should they have an accident, become ill or unemployed, or if they die. Consumers may buy PPI with most types of credit, such as hire purchase, a personal loan, a mortgage, a secured loan (a second mortgage on their home), a credit card or a store card.
PPI will pay part (or all) of the repayments on the loan or credit agreement if they cannot work because they are ill, have an accident or lose their job. It can also pay a lump sum to their credit provider if they die before they have paid the amount owed.
PPI can usually be purchased from the company offering a credit agreement. There are also stand-alone providers in the market.
If you are taking out a loan, consider how you would repay it if you lost your job, or became ill. You can shop around, or you can usually buy PPI from your loan provider, once 24 hours have elapsed from you having signed the loan agreemeent.