What is the difference between Single and Regular premium PPI?
PPI policies are sold on either a Single or Regular premium basis. With a Single premium policy a lump sum of 3-5 years’ worth of premiums is paid in advance and this amount is added to the sum borrowed and accrues interest, so the customer is paying more over the long term. The interest and implications if the customer cancels the policy or repays the loan early, should always be explained before purchase of the PPI is finalised. With a Regular premium PPI the customer does not make this advance payment and so pays less in the long term.
