The Financial Conduct Authority (FCA) has fined high-street insurer Swinton Group Limited, one of the largest insurance retailers on the high street, £7,380,400 for mis-selling.
According to a notice from the City watchdog, the FCA found that Swinton’s aggressive sales strategy meant that it failed to treat customers fairly in its telephone sales of monthly add-on insurance policies.
The FCA notice said that, between April 2010 and April 2012, Swinton sold personal accident, home emergency and motor breakdown policies, which during the relevant period generated an income for accounting purposes of £92.9m.
The FCA found that Swinton did not provide enough information to customers about the key terms of the policies and also failed to properly monitor its sales calls.
Swinton set aside £11.2m to repay those customers who were mis-sold, of which £1.9m has already been paid out. Swinton has contacted more than 650,000 customers, whom it thinks may have been affected.
Tracey McDermott, the FCA’s director of enforcement and financial crime, said: “Swinton failed its customers. When selling monthly add-on policies, Swinton did not place the consumer at the heart of its business. Instead it prioritised profit.
“At the FCA we have been clear in our expectation that firms must behave in the interests of consumers. Today’s outcome shows our approach in action and will act as a deterrent for other firms tempted to put profit figures above the fair treatment of customers.”
The FCA has said that any policy holders who believe they bought monthly cover as a result of mis-selling should contact Swinton directly.
