Taxpayer-backed Lloyds Banking Group has axed the sale of controversial debt insurance across all its brands in a landmark move, MoneySavingExpert.com can reveal.
Many victims of debt insurance mis-selling will get a temporary extension to the time they have to complain to the Financial Ombudsman Service, if rejected by their lender.
The new chief financial ombudsman says consumers should not use claims management companies (CMCs) when making a complaint to the independent arbitrator.
Banks and lenders say they will continue to missell debt insurance, as it was revealed consumers could be due over £4 billion in compensation over the next five years.
9 March 2010
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