Thousands of insurance customers could be owed compensation after claim issues – are you one of them?
THOUSANDS of insurance customers could be owed redress after the regulator slams firms for not following the rules.
A combined £92million worth of compensation was paid to those whose insurance complaints were upheld in the first half of 2022.
The average customer received £172 in redress in the same period, according to the Financial Conduct Authority (FCA).
However, the total amount of redress paid out to customers who complained in the second half of 2022 fell by 55% to £41million.
The average amount of redress issued also fell to just £94 per customer.
The FCA has said today that the volume of complaints relating to insurance claims handling and the number of rejected claims is continuing to increase.
Rejected claims increased for both home insurance (up 57%) and motor insurance products (up 24%) over the four-month period from August to November 2022.
But the FCA is also concerned that some firms aren’t doing enough to support vulnerable customers.
It comes just days after the regulator slammed Direct Line after it admitted that it underpaid some customers.
Direct Line is now reviewing all write-off claims settled between September 1 2017, and August 17 2022.
The company which has five million customers will help identify any of those with car insurance who received an unfair settlement during this period.
The firm has said that customers don’t need to take any action and anyone affected will be contacted directly.
Affected customers will receive compensation plus interest but the firm hasn’t confirmed when this will be paid.
Sheldon Mills, executive director, consumers and competition at the FCA, said: “Timely and fair claims handling is especially vital during the cost of living squeeze.
“While we have seen many firms treating their customers correctly, we found too many examples of customers not receiving the service they’re entitled to.
“Where we found issues, we’ve told firms to put them right. We’ll be monitoring them to ensure they do.”
Customers should contact their insurance company to complain if their claims have been delayed or if they’re not happy with how their claims are being handled.
They can also raise a complaint with the Financial Ombudsman Service if they are not satisfied with the firm’s response.
We’ve explained how to do both below.
How do you complain about insurance claims?
Insurers are required to have a written complaints process that tells helps customers how to make a complaint.
You should be able to find the information on their website but if you don’t, ask them to send it to you.
It’s worth making your complaint as soon as possible, as it’ll be easier to remember all the relevant details to strengthen your case.
Then simply follow each stage of the process, and submit as much evidence as you can.
Once you’ve sent in your complaint, the firm needs to give you a response within eight weeks.
If you don’t get a response within eight weeks or you’re not happy with the one you do get, you can take your complaint to the free Financial Ombudsman Service.
How do I take your complaint to the Financial Ombudsman?
If you decide to take your complaint to the Financial Ombudsman (FOS), keep in mind you must typically do so within six months of your provider’s final response.
To get in touch, you need to fill in a form, which you can find on the FOS website.
If you’d prefer to talk it through with someone, the FOS can help you do this if you call 0800 023 4567.
When you get in touch, you need to have the following details to hand:
- Some basic information, including your name and address
- What the problem is, and how you want things put right
- Details such as the policy number or account number that your complaint relates to
The FOS will then look at the evidence provided by both sides, and it may contact you for more information.
Once it’s made a decision, it’ll write to you and if it agrees with your complaint, it’ll say what your insurance firm must do to put things right.
If all else fails and you still think you’re entitled to compensation you can try taking your insurer