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.

MPPI eligibility questionnaire
Demands and needs checklist - advised sales
Demands and needs checklist - non-advised sales
'Need to know' customer statements
Non-advised MPPI sales tips
Demands and needs statement - non-advised sales

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.

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.

A consumers’ guide to Payment Protection Insurance (PDF document, 338K)
CML/ABI MPPI consumer guide ‘Take cover for a rainy day’ (PDF document, 471K)