F&I Management & Training

Car dealers that offer payment protection insurance (PPI) as part of finance packages must ensure they follow the rules on sale of these products or risk incurring heavy fines, warns the RMI National Franchised Dealers Association (NFDA). Sale of insurance products, such as PPI, is regulated by the Financial Services Authority (FSA). Businesses that sell or advise on insurance products such as credit protection insurance, warranties, GAP products, and general motor insurance must be accredited by the FSA. If businesses fail to meet the standards required they will be fined by the FSA. NFDA Director Sue Robinson commented: 'Dealers that offer finance packages, including PPI, must make sure that they follow the rules laid down by the FSA. This will involve training staff so they can provide the right advice on the various products, and having the right systems in place to ensure that customers are sold the correct product most suitable to their needs. 'The NFDA is working with the FSA to ensure that the regulations are as effective as possible, and that they benefit businesses and consumers alike.' Robinson continues: 'PPI is seen as a high risk product by the FSA, so requirements for businesses that offer it are more stringent than selling other insurance products. This has led to a number of dealers stopping PPI product sales, and concentrating on lower risk products, such as warranties and GAP. Robinson adds: 'NFDA members that require more advice on this issue should contact the NFDA.

DATED: 22.08.08

FEED: AW