A crackdown on controversial payment protection insurance is set to cost banks and insurers millions of pounds.
A number of major players have warned that they will be hurt by reforms to the sale of the product, which covers debt repayments if the holder is unable to work due to an accident or illness or if they lose their job.
Earlier this year the Competition Commission announced that it was banning the sale of single-premium payment protection insurance, under which the premiums are added to the debt being taken out.
It also plans to introduce a number of other measures to boost competition in the market, including banning the sale of PPI alongside credit cards, loans and mortgages.
Providers will instead have to wait for seven days before they can contact customers to sell them the insurance.
In February the Financial Services Authority called on all firms to voluntarily stop selling single-premium PPI with loans as soon as possible - and imposed a deadline of May 29.
Around 6.5 million PPI policies are currently taken out each year, generating revenues of £4bn for banks and insurers, but the reforms being introduced are expected to severely shrink this figure.
Lloyds Banking Group announced last year that it was switching away from selling single-premium PPI to offering the regular premium version of the product, following customer feedback.
But it warned the move would cost it £300m over the coming 12 months - although it added that it would recoup this over three years through the income on regular premium policies.
Both Lloyds and rival RBSblamed the withdrawal of single-premium PPI for denting retail banking revenues.
Insurance giant Aviva also said changes to the way the product was sold heavily impacted its insurance sales.
The FSA has taken action against 20 firms over poor PPI sales practices, including levying a £7m fine on Alliance & Leicester in October last year.
But the product is proving worthwhile to many people as unemployment rises.
Figures from the Association of British Insurers recently showed the number of PPI claims being made by people who had lost their job had more than doubled between November 2007 and November last year.
Source: Sky.com