Banks begin court challenge to payment protection insurance rules

BRITAIN'S major banks will this week begin their London High Court challenge over new rules on the way complaints about controversial payment protection insurance must be handled.

The British Bankers' Association is launching a judicial review against the Financial Services Authority and the Financial Ombudsman Service over regulations that came into force in December. The rules aim to ensure consumers are treated fairly, both when they buy payment protection insurance and when they complain about being mis-sold the cover.

To ensure people understand what they are buying, providers will have to talk potential customers through the key features of a policy, rather than just provide them with a document giving the information.