People who take out independent payments protection insurance instead of automatically taking cover from their insurer can save themselves thousands of pounds, a new study claims.

Many High Street banks are still including the cost of the payments protection insurance in the overall cost of the loan with some not making it clear to borrowers that they do not have to take out the cover if they do not want to, according to insurance broker Paymentcare.

But by using stand-alone cover then people could save themselves an average of £3,353 on repayments over the period of the loan.

Shane Craig, managing director, Paymentcare, said that hard sell tactics left people thinking they be at a disadvantage if they did not take out the cover.

"The lenders covered in this mystery shop are guilty on two fronts: firstly, by giving the first quote with payment protection insurance as it is an inflated figure, and not one that the consumer would necessarily want. And secondly, they have all omitted to establish the eligibility of the applicant before doing a hard sell on the loan," he said.

Mr Craig added: "Bank sales teams are encouraged to pursue hard sell tactics, as lenders make phenomenally high levels of profit from selling payment protection insurance cover: we estimate that, out of the £4 billion spent by borrowers on payment protection insurance every year, around £2.5 billion is stripped out by the banks in commission payments."