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What is the most complained about financial product?

When your finances go wrong, it can be incredibly frustrating, especially when it’s not your fault. But what are the most complained about financial products, and what can you do to avoid common pitfalls?

PPI (Payment Protection Insurance) remains the most complained about financial product, according to the Financial Ombudsman Service’s (FOS) annual review of complaints. Since 2001, half of all complaints to the Financial Ombudsman Service have been about PPI.

But some financial products have had hefty increases. Payday loan complaints have tripled, and new consumer credit complaints increased by 40%. Examples of consumer credit include hire purchase and point of sale loans.

Other notable spikes include complaints about packaged bank accounts, which have doubled, personal pension plans, and insurance such as pet insurance and emergency home cover.

Avoid these financial product alarm bells

Lots of financial products can turn sour. The key is knowing what the warning signs to look out for are.

For example, you might want to consider PPI if you have a mortgage, a loan or credit card repayments, and you want to make sure you can continue to pay for your policy if you fall ill or are made redundant.

But in the past, some banks and lenders sold policies without fully explaining the product, or falsely claimed it was compulsory for anyone taking out a loan. If this happened to you, remember you don’t need to use a claims management company to reclaim what you are owed.

It is also important to consider whether you need the product you are considering. You should never take out a payday loan unless you’re 100% certain you can repay it on time and in full.

Before you get a packaged account, you should consider whether you are actually going to use all of the extras.

Got a complaint? Here’s what to do

If you have a complaint about a financial product or institution, there are a series of steps you need to take.

You must always talk to the firm you’ve taken out a financial product with first, and follow the company’s official complaints procedure, if they have one. You should get a final decision within eight weeks on your complaint.

If you think the firm’s answer is unreasonable, this is when you can go to the Financial Ombudsman Service for impartial help.

 

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