Complaints roll in at increased levels
The integrity and performance of the financial services industry is largely determined by the ability of insurers and brokers to fly under the radar of the various industry ombudsmen.
This shows that companies have the client’s best interests at heart and are eager to work side by side as valued business partners. After all, insurance is a business transaction.
If this is the case, then there are some areas of concern for short term insurers as the Annual Report of the Office of the Short Term Ombudsman (Osti) does not make for the best bedside reading.
Important numbers
The most important number to regard when looking at the performance of the industry is the amount of complaints it received during the year. Deanne Wood, the Ombudsman, pointed out that Osti received 14 916 complaints during 2016.
While less than the 14 571 complaints received in 2014, the 2016 figures continue the trend of a steady increase of complaints since 2013 where 13 278 complaints were received.
Deception at its best
Determinations remain the most popular information that is provided by the Ombudsman, and the cases heard in 2016 did not disappoint.
In the first case, Mr A tried to claim for a stolen vehicle from his insurer. During the investigation, it was discovered that something was not right, and the assessor appointed by the insurer to validate the claim discovered discrepancies in the registration of the vehicle. It also came out that the insurer had significant suspicions that the vehicle was in fact cloned.
Please follow the link to read more about this case.
Trying to pull a fast one
Creativity when it comes to claims must be an amusing topic of discussions in the back offices of the Ombud and insurers.
In this case, Mr G reported to his insurer that his car was stolen after he was at the receiving end of a fraudulent transaction. Mr G only discovered this after the deal was concluded and the car was not in his possession.
The reason he gave for handing over the car to the third party is quite something. The full case can be read here.
Lies, lies, darn lies
In the following case, a policyholder submitted a claim to his insurer saying that he was hijacked after assisting an elderly man with a lift into town. Upon investigation of the case, the insurer found that the policyholder had submitted a similar case before and that the story he told was a very convoluted version of what was at best an accident.
The full story can be read here.
The usual suspects
As in previous years, motor complaints made up the majority (49%) of the Ombud’s business. This was followed by complaints relating to home owners insurance which made up 21% of complaints. Complaints relating to household contents and commercial policies came in at 7% each.
In terms of claims resolution, motor dominated again followed by household contents complaints and homeowners complaints.
Editor’s Thoughts:
The fact that the Osti received a record number of complaints in 2016 may support the theory that in times of economic crisis, policyholders do get desperate and take a chance with insurers. This can clearly be seen in the nature of the complaints and the fact that all parties need to remain vigilant at all times. Please comment below, interact with us on Twitter at @fanews_online or email me your thoughts [email protected].
Comments
What is even more disturbing is that a major source of information like the FA News would take what is clearly a really good-news story about the industry and manage to put a negative spin on it. After all, one would expect them to be on the side of the intermediaries and insurers, no?
Of course, the rate of complaints is more enlightening than the rate of growth. Also, the examples quoted are reflective of the general attitude to insurance and the willingness to pull a fast one among many insureds - which makes it even more remarkable that there are so few complaints that stick.
The tone of this article will not help the perceptions that insurers are scoundrels and fair game. Report Abuse
As as a proportion of policies in force there has been a decrease, not an increase in matters referred to the Ombudsman.
Moreover, the number of claims rejection decisions overturned in favour of complainants has dropped from over 30% to 25%.
As approximately 0,3% of claims become Ombudsman complaints, this means that less than 0.08% of claimants have complaints that are found to be reasonable.
This figure is down nearly 20% from an average 0,1% in previous years.
Strange that you do not feel this fact is important enough to report upon....?
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