Policyholders have suffered for far too long

All power to Mr Wheatley

Rather than look at their own business models and question whether they really have been treating their customers fairly, insurers are choosing instead to blame the FCA.

From the insurers’ point of view, it was unfortunate that the talented journalist Dan Hyde got a terrific scoop for the Daily Telegraph by revealing FCA plans to look at how existing policyholders are being treated. If only the insurers were as quick to consider the interests of their policyholders as they are to protect the interests of their shareholders.

The truth is the policyholders – that is, customers – have had a woeful time for much of the past 15 years and have been treated in the most shabby fashion.

Many have seen their savings punted around in one sale after another until they no longer know who is running their money. Information has been so sporadic that many have no idea which firm to contact if they have a question. Managing investment funds has taken second place to pruning costs, resulting in awful returns.

Despite the lack of decent management and service, charges have remained high, while such information delivered to policyholders is often impenetrable.

These are all areas insurers could choose to address. Instead, they and their trade body appear to have been briefing Sunday papers. A number of City editors and commentators produced astonishingly similar columns in the last weekend of March, warning of the dangers of allowing pensioners to have control of their own money and generally praising the wonderful insurance industry.

Insurers have clearly been taken by surprise. They are used to getting a soft ride. They got a free pass on endowment mis-selling. The FSA was far too close to senior industry figures and bought their arguments. Fears of undermining profits for shareholders took precedence over fairness to policyholders.

The FCA has proved far less malleable and much harder to intimidate, while the government has proved difficult to dupe, with a pensions minister who is on top of his brief.

Yet chair of the Treasury select committee, Andrew Tyrie, inadvertently played into the industry’s hands by criticising the FCA. Perhaps he should consider more carefully who he represents.

Policyholders have suffered at the hands of the insurance industry for far too long.

The truth is the policyholders – that is, customers – have had a woeful time for much of the past 15 years

Fight for clients, not against FC

The FCA supervisory work on the treatment of long-standing insurance company customers has generated some predictable comments from certain sectors of the IFA community.

“Surely a contract is a contract whenever it was taken out,” said one. Others are calling for Clive Adamson, FCA director of supervision, whose interview provoked the latest furore, to be sacked, and for Martin Wheatley to resign.

But why? It is your clients who are stuck with these old policies. As financial advisers, you should be representing their best interests, not be the patsies of the insurance industry.

Surely you should welcome work aiming to ensure your clients are getting a fair deal from insurance companies.

This is not a mis-selling investigation where the bill could end at your door. It is considering whether these investments are still appropriate and whether people are getting the information and service their fees are buying and they have a right to expect.

Why should this be so objectionable? These comments can only be based on blind hatred and mistrust of the regulator, and a failure to consider the position of people who were advised to buy a product years ago that may no longer be serving their best interests.

£30 just to push a button

Since writing on investment Isa exit fees last week, I have further details of the administration involved. In some cases there will be manual form-filling, but in most the transfer can be done at the touch of a button.

For this, many fund supermarkets are charging £25, while Barclays Stockbrokers charges £30. Is this a fair reflection of the cost of the administration? You must be joking. These fees are indefensible and unfair. They should be reduced to a minimum or be banned.

Tony Hazell writes for the Daily Mail’s Money Mail section. He can be contacted at t.hazell@gmail.com