PPI claims firms face snub by consumers
Consumers are increasingly shunning no-win no-fee claims firms as they chase compensation over the mis-selling of payment protection insurance.
The Financial Ombudsman Service (FOS) said that up to half of 85,562 new PPI complaints made in the first six months of 2012 were made directly by consumers, against less than 20% a year ago.
The number of PPI complaints has risen 73% since the second half of 2011. The FOS handles 3,000 calls a day on the issue.
Claims management companies (CMCs) take around 25% on average of compensation paid out to cover fees, said the FOS. They have been criticised for the levels of fees and onerous contracts.
The latest FOS data revealed that new PPI complaints continue to flood in despite the shift away from CMCs — with PPI cases making up 63% of total complaints received by the ombudsman in the six months to June 30.
The total number of complaints rose to 135,170 in the half-year — up 27% on the past six months.