A RECORD number of disputes regarding the mis-selling of payment protection insurance (PPI) will need to be resolved over the next year, as banks and insurers have subjected customers to “delays and inconvenience”, a finance watchdog warned.
Despite a legal challenge to PPI complaints being dropped last year, the Financial Ombudsman Service (FOS) said it was “disappointing” a significant number of consumers are still waiting for businesses to clear up their cases.
The ombudsman expects to settle 130,000 PPI cases in the financial year 2012/13 and warned that many of these disputes are likely to be “more entrenched”.
This figure is up from 109,500 this financial year and more than double the 60,000 PPI cases resolved in 2010/11.
The FOS said it will need to gear up on an “unprecedented” scale to tackle complaints, with PPI cases expected to make up half of its workload. It is consulting on plans on how to cope, including proposing businesses pay an additional fee of £350 for PPI cases on top of the £500 standard case fee, saying it would not be fair for those not involved in mass PPI claims to cover the costs.
Tony Boorman, principal ombudsman, said: “A year after the High Court ruling gave us legal finality on the approach financial businesses should take on PPI complaints, it’s disappointing there’s little finality for significant numbers of consumers who are still waiting for their bank or insurer to deal with their complaint.”