MPPI Tips and tools
If your firm sells Mortgage Payment Protection insurance (MPPI), you need to be able to demonstrate TCF at the point of sale. You can do this through:
- collecting sufficient information about the customer
- making clear to customers that PPI is optional
- giving full information about the product and what it will cost
- making clear to customers what they are eligible for under the policy and what the main exclusions are
- telling customers why, where advice is given, the recommended policy meets their demands and needs
- compliant record keeping and disclosure
- targets and incentives that support TCF
- regular monitoring of files
Implementing TCF standards will help you minimise unsuitable sales and should result in:
- fewer rejected policy applications
- fewer rejected claims
- fewer policy cancellations
- fewer complaints relating to MPPI
- reduced likelihood of FSA enforcement action (and consequent reputational damage/financial loss)
Tips, tools and links
The checklists and questionnaires below (which are TCF support tools only and may need adapting to take account of the particular features, terms and conditions of the policies you sell) are designed to help ensure that:
- the customer’s demands and needs are fully recorded
- you ask the necessary questions to establish eligibility
- you provide appropriate information for a non-advised sale, and avoid inadvertently offering advice
- in the case of an advised sale, you provide a clear record of how the final recommendation is reached and why
- the customer receives a compliant and easy to follow summary of the type of service they are receiving, the overall cost and key features/exclusions of the policy being offered, together with clear signposting to more detail if required
The information gathered via the checklists will help provide what you’ll need for your ‘Statement of Demands and Needs’, to be provided to the customer and kept as a record for at least three years after a sale.
Please note that these checklists are a support tool only for the sale of mortgage payment protection insurance. For detailed requirements on FSA insurance sale rules follow the links to the FSA at the end of the checklists and below. If you sell PPI for products other than mortgages – including loans – you will need to ensure that you embed TCF within the sales practices, policies and procedures that have been implemented in relation to those products.
Related Links
As well as using the checklists above, you may find it of use to provide your customers with consumer guides to PPI and/or MPPI.
The Council of Mortgage Lenders (CML), Association of British Insurers (ABI), British Bankers Association, Finance and Leasing Association, and Association of Creditor Insurers have produced a joint guide on PPI which has been awarded the Plain English Campaign Crystal Award for clarity. The CML and ABI have also produced a separate guide on MPPI called ‘Take cover for a rainy day’. You can download both guides below.
