The group placed secured loans – which are typically secured on a borrower’s property – in sixth place on a new top ten list of pointless and wasteful financial products, warning that the benefits of such a loan did not balance the risk of losing one’s home. Which? advised customers that such a product was “risky – only take out unsecured loans”.

At the top of the list was mobile phone insurance, which can cost up to £100 and was declared to be a waste of money, as “most people are already covered by their home insurance”. It was followed by extended warranties. Which? said that these could cost up to half the price of the product itself and were “too expensive to ever be worthwhile”.

The number three spot went to structured products – a kind of bank-backed investment package – which was said to be “confusing, complex and costly” compared to a more streamlined savings account, such as an ISA.

At number four was ID fraud cover, which offered protection already generally covered by a customer’s bank anyway. Payment Protection Insurance (PPI) was at number five, the sale of which alongside personal loans or credit cards is about to be banned by the regulator.

Which? Money Quarterly editor-in-chief James Daley commented: “Our research found that there is a bunch of financial products on the market that most people really don’t need. Don’t just follow what a salesman says – do your own research, speak to an independent financial adviser if you need expert help and make an informed decision about which financial products are right for you.”

At present, customers who take a complaint about a personal loan or other financial product to the lender company and had it rejected have six months to involve the Ombudsman. However, in the case of PPI complaints, the FSA said at the end of last week that any customer who has received a final response from a company between 28 November 2009 and 28 April 2010 now has until 27 October to complain to the Ombudsman.

Were it not for this exceptional ruling, the final day for people who received letters from their lender at the end of November last year would have been last Friday.

The extension has been granted as the watchdog continues to negotiate with lenders over proposals that they reopen previously rejected PPI cases. Some lenders have proven reluctant to do so, so the FSA has decided to take another five months to properly assess their responses, with a final decision due on 27 October.

A recent report by the Financial Ombudsman revealed that some 135 people a day complained to it about PPI in the last financial year and numbers are increasing. It said that during this time, a third of the 166,000 disputes that it resolved were regarding PPI.

The insurance product itself has come under the spotlight recently after the Competition Commission announced last month that it plans to ban PPI sales at “point-of-sale” – meaning that it can no longer be sold along with unsecured personal loans, credit cards and mortgages.

The watchdog provisionally decided last week to press ahead with plans to prevent point-of-sale PPI, after an investigation concluded that this would increase competition and bring down prices. However, writing on the CityWire.co.uk website, industry analyst Lorna Bourke argued that the move could leave people at greater risk than before when they undertook a personal loan, because they may not be aware that alternative forms of insurance exist.

“There is a real danger that banning all PPI policies sold alongside a mortgage or personal loan could result in borrowers having no protection at all. This could mean homebuyers losing their homes if they are unable to meet repayments,” she insisted, pointing out that many observers were asking whether financial services companies would bother to create affordable alternatives to PPI if they did not also have a “tied clientele”.

Not everybody agrees that PPI is such a good thing, however. Motley Fool director David Kuo also said this week that many borrowers who run into difficulty repaying their personal loans are unable to claim on the insurance, due to “onerous clauses” in the contract.

Mr Kuo argued that most of the reasons that customers think are a legitimate basis for a PPI claim were not covered by the insurance. He went on to say that banks were likely to increase the interest on their personal loans if they were not allowed to sell PPI directly.

An FOS report said that the watchdog mediated in over 166,000 disputes between lenders and borrowers. It said that this figure represented a 46 per cent increase compared to the previous financial year – and nearly a third of these disputes involved borrowers who had taken out PPI on their unsecured personal loans, mortgages or credit cards.

The Competition Commission announced last week that it has provisionally decided to ban the sale of PPI alongside personal loans, mortgages and credit cards, instead requiring lenders to wait seven days before offering the financial product. PPI ensures that borrowers’ repayments are covered if they find themselves in difficulties due to unemployment, sickness, injury or bereavement.

The regulator said last week that point-of-sale PPI led to a situation in which lenders faced “little or no”competition in the marketplace. This appears to have been born out by the FOS statistics, which showed that virtually all the complaints it received about the insurance concerned alleged mis-selling, rather than any difficulties involved in claiming on it when necessary.

The FOS went on to point out that around 66 per cent of complaints about PPI came to its attention via the services of fee-charging claims management companies, acting on behalf of individual borrowers – and it stressed that customers could apply to the watchdog directly.

“People who think they have been mis-sold a PPI policy don’t need to use a third party to make a claim, they can come directly to us for free,” FOS spokeswoman Emma Parker told The Guardian newspaper. All complaints are dealt with on a case-by-case basis.

The plans were originally for a complete ban, but the commission eventually decided to ban PPI sales at the point-of-sale of personal loans and other financial products. Instead, lenders will be able to offer PPI after seven days have elapsed since the original sale.

It originally announced the plans in October 2009, after which it faced a legal challenge from banking giant Barclays. With the support of Lloyds Banking Group and Shop Direct Group Financial Services, Barclays claimed that the proposals were not proportionate and unjustified, and the Competition Appeal Tribunal ordered the watchdog to investigate whether an outright ban would be bad for customers.

However, after considering the evidence, the Competition Commission announced this week that a ban on point-of-sale PPI would improve competition in the personal loans market and eventually lead to lower prices. This would outweigh any disadvantages of the move, it said.

PPI ensures that payments towards unsecured personal loans, mortgages and credit cards will continue to be made if the borrower is left financially embarrassed due to long-term sickness, unemployment or accidents.

If the Competition Commission decides to stick to its provisional decision this week, it has pledged to introduce the point-of-sale ban as “swiftly as possible”. Barclays declared itself disappointed by the watchdog’s decision, and a spokeswoman said: “We still maintain that to prohibit PPI being sold at the point of credit sale and for a fixed period afterwards will limit rather than enhance customer options and will result in customers being exposed as unprotected.”

There are a variety of life insurance policies available, so it’s important to understand the differences.

Term Life Insurance:

With term life insurance you pay for a predefined term, and are covered for that term (normally the same term as your mortgage).

Term life insurance only offers protection for the duration of the mortgage, and is normally of no value when your mortgage is paid off.

Term insurance is also cheap, and can even become cheaper over time. There are also a number of different types of term life insurance to choose from as follows:

* The first is level term insurance, and it is the most popular type of cover. This policy has it’s premium costs locked in for the full term of the policy, so you pay the same amount each month for the entire term of the policy.

* The second type of term life cover is known as escalating term insurance. This type of scheme means that you pay an increasing amount each year, so the payout at death also increases. They are generally low cost policies, and are more suited to first time buyers and the young. However, they can become more expensive as you get older.

* The third type is known as decreasing term insurance. In this case your monthly payments will stay the same, although the amount of cover you receive will reduce each year.

* The forth type of term life insurance is what’s known as increasing term insurance. Here the lump sum payable at death increases each year. This increase in value of the policy is made up by increasing the premiums periodically over the years.

* The fifth and final type is known as convertible term insurance. It is a type of term life insurance that you can convert at a later stage into an investment vehicle. The value of the investment is normally based on your health when you originally took out the policy.

Whole of Life Insurance & it’s Advantages:

A whole of life policy can be more complicated and more expensive than term life insurance. However, a whole of life insurance policy covers you up until the time of your death, providing that you keep paying your premiums!. The advantage of these types of policy is that your family could receive a considerable lump sum when you die.

Whole of life policies can be more expensive and more complicated than term life insurance. Also, the investment you make can earn some interest each year. Therefore, since your investment generally grows each year, your premiums can actually reduce over time. You may also reach a time where the interest gained covers all the future premiums, which means you may have no more premiums to pay.

However, it’s important to understand that it is possible the cash-in-value of a whole of life policy may actually be less than the amount put into the policy over it’s full term.

Summary:

The decision of whether to buy a term life policy, or whole of life cover comes down to your own unique needs, and circumstances, and what you wish to achieve.

Term life policies are the simplest and cheapest to set up, and cover you only for as long as you need them.

On the other hand, you might like to consider a policy that grows in value over time, giving you a very nice nest egg which you can benefit from, while you are still alive.

Both types have their advantages and disadvantages, and careful consideration and advice from a competent insurance adviser is vitally important.

Michael Pettigrew writes for numerous insurance sites including Best Insurance Quotes, a provider of quality low cost life insurance. Visit Best Insurance Quotes for a better life insurance quote

There are three types of car insurance. Actual cash value is the most common type of car insurance. It pays out the depreciated book value of the car. Stated value allows the car’s owner to state a value for the vehicle that is greater than the actual cash value. Agree value guarantees the car’s owners will get all of their money back in the event that the car is a total loss.

These types of insurance are offered through a standard insurance provider. The owner of a classic car should also consider a classic car insurance policy. These policies can be cheaper and less restrictive than a standard car insurance policy. Some classic car insurance policies require the driver to be 25 years or older. Some programs even require the driver be at least 30 years old. Classic car insurance programs could also limit the amount of driving you do to 2,500 miles or less a year. Annual odometer readings could also be required. The insurance provider will give you specific information on what requirements need to be met in order to insure your classic car.

No matter whether you opt for a standard policy or classic car coverage, be sure that your policy allows flexible use of your car. You want to be sure that you can use the car for an unexpected trip or exhibition without having to buy a rider or a new policy altogether. If you keep your vehicle in storage part of the year, be sure to tell you agent. Some policies offer lower premiums if you drive the car only certain months of the year.

When it’s time to choose a car insurance provider, do your research. Make sure you find a car insurance provider with the knowledge and experience in insuring classic cars. You want to make sure your car insurance provider knows how to properly protect your classic car investment without taking advantage of you. Research both standard insurance providers and classic car insurance providers. Shop around and get more than one insurance quote. Compare quotes and see which provider offers you the best deal. Just make sure the policy offered meets your needs. You don’t want to accept an insurance provider’s offer because the price can’t be beat, only to discover later that the insurance coverage is not what you need for your classic car and driving situation.

Regardless of what type of car insurance policy interests you, make sure you work with a qualified insurance provider. They can look at your exact situation and recommend the insurance product that will best suit your specific needs and protect your classic car investment the way it should be protected.

Tom Martens is the content syndication coordinator for Carinsurancesa.co.za. South Arica?s leading car insurance portal.