FCA confirms new PPI redress rules and complaints deadline

The rule is expected to be in place by the end of June 2017, with the deadline falling two years after this in June 2019.

The regulator will also make rules and guidance on handling PPI complaints in light of the Supreme Court judgment in Plevin v Paragon Personal Finance Ltd.

In November 2014, the Supreme Court ruled that a failure to disclose to a client a large commission payment on a single premium PPI policy made the relationship between a lender and the borrower unfair under section 140A of the Consumer Credit Act 1974.

The Plevin rules and guidance are expected to come into force by the end of March 2017 to allow firms time to prepare for and implement the provisions.

The new guidance aims to clarify how firms should assess fairness and redress where commission or profit share rates vary during the life of the PPI policy.

It will also allow previous rebates to a consumer when they cancelled their PPI policy to be partly reflected in (and so reduce) any redress due.

Andrew Bailey, chief executive of the FCA, said: “Putting a deadline on PPI complaints will bring the issue to an orderly conclusion in a way that protects both consumers and market integrity.

“We have listened to all the feedback we have received and believe that the steps we are taking are the right ones. We will ensure that our communications campaign will engage with all those who could be affected, particularly vulnerable consumers.”