The Financial Ombudsman Service received a record number of complaints about controversial payment protection insurance during January.
The group received 1,499 complaints during the month, compared with 1,832 during the whole of the 2006-07 financial year. It said it had seen a steady increase in the number of complaints since the beginning of this financial year, and the cover was now the most complained about insurance product.
At the same time the FOS said it was upholding 80 per cent of the complaints it looked at, more than double the average for the insurance sector of between 33 per cent and 40 per cent.
Emma Parker, for the Service, said: "There was a record number of complaints about PPI in January and the number is increasing month-on-month.
"The fact that so many complaints are being upheld suggests that firms aren't doing enough to deal with these."
PPI is taken out to cover debt repayments on credit cards and loans if the holder is unable to work due to an accident or illness or if they lose their job.
But the £5 billion market has been criticised in recent years over claims that the insurance is overpriced and being mis-sold to people who would never be able to claim on it. The Competition Commission is currently conducting an investigation into the market and City watchdog the Financial Services Authority is carrying out work to improve sales practices.
Complaints to the FOS ranged from people claiming they were not given a choice about buying PPI to consumers being sold policies they would not be able to claim on.
Ms Parker said a lot of people were not aware they had taken out PPI with a loan, while others were told they had to take it out to get the loan, and in some cases it was presented as being integral to the loan, without the separate cost being explained.