FCA Complaints Fall by 10%
The Financial Conduct Authority (FCA), the insurance industry regulator have recently released figures showing that complaints against general insurance products have fallen by around 10% for the first half of 2013 against the same period in 2012.
There is still a lot to be done by the insurance industry as there were still £2.1 million complaints in this six month period which ranks as the third highest figure received to date by the regulator.
Complaints against insurance products are top of the FCA’s complaints list; they overtook complaints against banks in the second half of 2011 after a period of a rapid rise in complaints. The figures released show complaints almost tripled at their peak in the second half of 2012.
Whilst this figure of £2.1 million is enormous the vast majority of complaints, around 85% were related to the Payment Protection Insurance (PPI) miss-selling scandal.
So as we can see the general insurance industry still has a huge number of complaints reported in each six month period but the real figure is closer to 320,000 (excluding PPI claims) so the industry still has a lot of work to do to ensure customers are being treated in a fair and appropriate manner and understand the product they are purchasing.
The frustration for the small general insurance broker is that very few (if any) offer the insurance products which account for 85% of the reported complaints, and that these complaints are mainly directed to the banks and large national brokers. The banks plight has been widely publicised in press over the last few years mainly towards miss-selling Payment Protection Insurance, and we have heard about the millions of pounds which have been paid in compensation. We have also seen recently that Swinton were reportedly fined £7.4m by the FCA for miss-selling add-on products to their customers.
We now live in a time when customers have the upper hand and if they are not satisfied then they will seek assistance from the regulatory body (FCA). So insurers and brokers need to focus on customer service and make sure their staffs are adequately trained and the procedures put in place to treat customers appropriately are upheld and regularly assessed. The way in which insurance is sold has evolved over the last 15 years and the industry as a whole needs to continue to work hard and maintain the very high standards expected by the FCA but more importantly the customer.