RegulationMay 15 2013

FCA launches thematic review of insurance claims

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ByMichael Trudeau

The Financial Conduct Authority has launched a thematic review of insurers’ claims processes.

FCA chief executive Martin Wheatley announced the review in a speech at the British Insurance Brokers’ Association conference today (15 May).

He said: “We know complaints about insurance products are on the rise. We know these complaints are more likely to be upheld in favour of the customer than ever before. And, significantly, we know the large majority of these complaints... are directly related to claims.

“I think it is right to dig deeper into figures like these. I think it is right to address public concerns that imply policy holders might be facing delays; poor customer service; or having perfectly valid claims unfairly declined.”

The review will cover the wider general insurance market but focus on household and travel claims. It will include sales sold through brokers and regulated advisers that sell general insurance policies.

Mr Wheatley added: “Very often, we are talking about enormously stressful periods in people’s lives... It would be very difficult, if not impossible, to defend any company if it was found to be aggravating these experiences by dragging its heels − or trying to wriggle out of its responsibility to pay legitimate claims.”

Alongside the announcement of the review, Biba, the Association of British Insurers and the Chartered Institute of Loss Adjusters separately announced they have set up a working group designed to “engage with the FCA” on the subject of claims management.

Andrew Gibbons, chair of the claims working group and managing director of Mason Owen Financial Services, said: “Biba is delighted that the insurance industry claims working group is now underway. Claims management is a large and very important subject.

“The claims working group will allow us to showcase how the industry helps customers as well as enabling the group to learn lessons from this forum in order to improve customer service.”

Nick Starling, director of general insurance at the ABI, said: “The claims experience is the shop window by which the industry is often judged, and insurers are committed to ensuring that customers get the service they need, when they most need it.”