Solicitors are poised to take on a wave of new legal work following a Competition Commission (CC) report on payment protection insurance (PPI), which showed that policyholders appear to be overcharged by more than £1.4 billion a year.

The provisional findings of the CC investigation, published last week, found companies face little or no competition when selling PPI, as the vast majority of the UK’s 14 million-plus policies are sold at the same time as a consumer takes out a loan or other type of credit.

Many consumers are unaware that they can buy PPI from other providers and rarely shop around.

Richard Emmett of Preston firm Emmetts, which runs the website www.financialmisselling.co.uk, said this was a ‘growing industry’ for lawyers.

He said some clients were better off pursuing their claim through the Financial Ombudsman Service – and his firm advises accordingly – but others are better suited to a formal legal remedy.

Mark Hollinshead of south Cheshire firm Taylor Hollinshead, who is working with claims management company Equity in Finance, says around 35 law firms have joined its panel, focusing on cases where brokers have earned secret commissions, rather than misselling.

Where clients have paid a single premium for a PPI policy, which has been added to the loan, research suggests that brokers are earning commissions of anything up to 60% of the premium without disclosing them to the client.

The panel has so far handled more than 1,000 PPI cases. He claimed one well-known bank has begun writing directly to clients and offering them just the return of the premium.