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home news Traffic light system for insurance and financial products
Traffic light system for insurance and financial products
The Financial Services Authority (FSA) has published proposals that will enable people to see how firms handle complaints – including the number received, the main products and services covered and how quickly they are resolved.   Insurers and intermediaries will have to publish their own complaints data every six months and the FSA will publish results from the whole sector twice a year.   Dan Waters of the FSA says, “Publishing complaints data will mean that people can learn more about how firms handle complaints and the frequency with which they arise.  We also consider that publishing this information will incentivise firms to deal more effectively with complaints and help to raise industry standards in this important area.”   The FSA is proposing that firms receiving the largest number of complaints publish information on: How many complaints they have opened and closed. The percentage closed within eight weeks. The percentage of complaints upheld.   This information will be broken down into five product areas: banking, home finance, general insurance and pure protection, life and pensions, and investments.  To make it easier for people to understand the data and compare the standard of different firms’ complaints handling, firms will need to provide contextual information such as the number of complaints per 1000 customer accounts.   The move goes further than Financial Ombudsman Service plans to publish specific data on firms with high levels of complaints, which begins in the Autumn.   From September, the FOS will publish complaint data every six months for every firm that has at least 30 new and closed cases during the period.   Some insurers and banks fought tooth and nail against the FOS idea, and are no doubt furious with the FSA plans. But both proposals are part of a much wider clampdown by regulators and the government. Many insurers and intermediaries welcome the proposals as they are sick and tired of being tarred with the same brush on poor products and poor service as the handful of firms, particularly banks, who have a poor track record and bring down the reputation of the rest of the insurance industry. It fits neatly into the Chartered Insurance Institute’s campaigns on increased professionalism for individuals and the businesses they work in.