PPF has received the following commentary on the OFT Report:

Last week the OFT report was released which included at paragraph 5.10 clarification that the OFT spoke to the FSA and – through the Association of British Insurers – received an assurance that PMI companies would either pick up ‘shortfalls’ in full or warn customers of the possibility at both the point of purchase and at the point of claim.  I think this makes the blog as drafted out of date.

This is good news as consumers are now better empowered than they were at the beginning of last week.

Furthermore, at paragraphs 5.84-5.87, the OFT makes it clear that it consulted the FSA and the Financial Ombudsman Service about ‘Open Referrals’.  The FSA and the Ombudsman confirmed that consumers should make complaints regarding inappropriate referrals as a consequence of Open Referral in the first instance to the PMI provider and then, should they remain dissatisfied, to the Ombudsman.  This is a welcome piece of consumer advice and it is good to know that the FSA is both aware of Open Referral and interested in using its considerable powers to protect consumers.

Another commentator observes:

The real problem with the referral to the Competition Commission is how much it will cost the sector. Insurers, Hospital Groups and Consultants will all be paying lawyers and advisors to protect their interests in what promises to be a troubling process. Since the only source of revenue to cover these costs – estimated in millions of pounds – is the private patient, it might be that referral should be less welcome than first thoughts!

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