Aviva Medios Healthcare - are we being treated fairly?

McAllister_2

If the FCA lets Aviva get away with selling a protection product that does not protect, everyone would have to ask what was the point of its work on PPI and why is it bothering with other scandals like CPP. It would be presiding over a lottery and not a regulated system.

harrop_2

According to press comment back in 2000 there were some 25,000 policyholders and that means the value of affected premiums must run into the hundreds of millions. If the FCA does not act, what hope remains for consumers buying other supposedly regulated products!!!!!!!!

blanchard

I do understand the excellent points made by McAllister and harrop.

I also understand the FCA's focus on CPP as I have read Money Saving Expert's commentary.

What I do not understand is why the FCA put so much resource and effort into beating-up CPP but has yet to act against Aviva.

CPP's total annual revenues for all its different activities probably do not exceed the premiums Aviva has charged for a product that's represented to protect against Age-Related premium increases but doesn't. CPP has a minor impact upon the Industry whereas Aviva's impact is huge. Knocking CPP will therefore have little effect upon the Industry. However, letting Aviva get away with what it has done can only encourage Aviva to do even worse, and the impact of that can only be mega.

Maybe I am missing something?

jennifer7

Have you heard the rumour that Aviva is launching a limited edition medical insurance policy that guarantees medical inflation premium increases will never exceed 5% per annum for as long as the policy is made available?

The policy will supposedly be initially priced at only 25% above current pricing for equivalent non-protected products. Terms and conditions are awaited but will be subject to change.

Bound to be a winner if this is true and not a wind-up.

hoight

Even if a policyholder pays for protection against some incidence or other, the Financial Ombudsman Service refuses to meddle in the fixing of premiums. Unsurprisingly, that necessitates endless somersaults and gyrations to duck and dive away from all ancillary issues.
The larger and more powerful the insurer, the worse the experience.

Consumers are constantly confused by the myth that the insurance industry is regulated.
That myth is made worse when every now and then the Regulator attacks toxic products, such as payment protection insurance, but stands back from other known product villainy.

Protection products are sometimes more akin to the legitimisation of protection rackets.
Victims are hoarded together under the banner of some perceived protection need.
Those supposedly protecting them, then repeatedly sting them - unrestrained by nothing.

Consumers cannot rely upon a Regulatory system that only works every now and then.

It seems consumers must avoid all protection products whenever possible.
At least the risk might never happen, against a certain sting that can become an increasingly unkickable and burdensome drug habit.

morsen

The Aviva Medios Case has massive ramifications for the Financial Services Industry and its Regulator.

For many years Government and Regulator have sought to rid the market of excessive charges and fees. Their objective has been to encourage consumer saving and responsibility instead of increasing reliance upon overburdened State resources. Not only has that effort been directed at disclosed charges but also hidden charges. It has also been a crucial confidence building step in the introduction of compulsory saving for all employees over the last few years.

Yet the Aviva Medios Case blows an absolutely massive hole in all those efforts. Costs represented as contractually non-chargeable have been charged on the basis that everything and anything can be charged when charges form any part of a premium. It does not even matter if charges are forbidden or limited. Where a premium is concerned, the provider can charge whatever it likes.

Aviva has not only thrown down the gauntlet to the Regulator but it has slapped the Regulator across the face with it, daring the Regulator to interfere with its freedom to set premiums and, therefore, kill the Industry’s Regulatory get-out Ace.

The question is whether this is the Industry taking on the Government and Regulator or whether it is the action of a single provider caught out with its ‘hands in the till’.

The Regulator needs to respond as otherwise the Industry will be increasingly encouraged to avail itself of this Regulatory get-out Ace whenever it suits. The result will to return us to a market consumers cannot trust and must steer clear of AT ALL COSTS.

latner

At least protection was sometimes provided by PPI.

With Aviva Medios it was never available as Aviva declares we were always charged for the increasing claims experience we were supposed to be protected from. The ombudsman confirmed and accepted that as FOS does not generally interfere with premiums.

If the FCA allows Aviva to get away with this, then consumers might as well avoid all financial services as their purpose would only then be to enrich product providers.

Jean819

The front page leader of this week's Industry paper, 'Financial Adviser', advocates using the auto-enrolment system for pensions as a way to introduce auto-enrolment for income protection.

This must be complete madness when we have an Aviva Medios product that charges for protection but ensures the promised protection is never provided.

The ridiculousness of this situation is even more obvious when one then reads the back page lead story where the Financial Conduct Authority's Head of Supervision is quoted as saying "We accept we are not perfect and we must do more to show we are a predictable, consistent and measured regulator that is on the side of the consumer, but also working with the industry when possible to solve problems".

The Industry seems to be preening itself and expecting a rosy future without realising the distrust caused consumers when mis-selling, like Aviva Medios, is left waiting to be resolved.

CompAssr.

Reported today from Reuters!!!!!!!

“The Bank of England's governor warned insurers that he will hold their top executives accountable in the same way that he has cracked down on Britain's errant bankers, The Times reported early Thursday.

In a comment piece written for The Times, Mark Carney said "integrity, honesty and skill" in senior managers are not optional, whether they are in charge of insurers, investment banks or building societies.

Carney said the Bank of England wants senior managers of insurance companies to be held accountable if things go wrong and policyholders lose out.”

Interesting to see whether the FCA acts upon this direction as we know:

• Aviva lied to an MP and Government Minister to prevent the FCA from investigating Aviva Medios policy complaints,
• FOS said that solely medical inflation increases “ideally would have been the way the scheme would operate in practice” but that did not happen,
• Once its first explanation for its premium increase was rejected by FOS, Aviva invented yet another story some 2 years after the event,
• FOS’s first ombudsman took action because “Mr D would have felt he was paying an age-related increase in a roundabout way” but the second ombudsman viewed that solely as disappointing and a scheme management issue “better addressed to the FCA”,
• FOS’s concluded view, that the matter was “better addressed to the FCA”, was because it claimed the entire subject of premium setting was outside its remit and a ”commercial judgement with which we would not normally interfere”,
• Aviva misrepresented the existence of New Entrants in repeated Terms & Conditions and their stopping was something FOS could do nothing about as it was ignorant on that subject and, consequently, the matter was better addressed by the FCA.

In all of this ducking and diving, FOS acknowledged the policy was “clearly marketed as a long-term policy” but was unable to explain why a policy marketed as protection against Age-Related premium increases did not provide that protection. FOS’s embarrassment also meant FOS avoided all mention of Aviva’s 2001 policy offer of limited change authority and inflation premium increases, as that conflicted with the crucial premise used for the first ombudsman’s decision. In fact everything about Aviva’s 2001 policy offer was avoided. This is now clear from all the Sakagawea decisions recently released on the FOS web site (the Sakagawea decision – previously distributed to many by the Sakagawea team - concerns MR G).

What still remains unclear is FOS’s defence of its private arrangement with Aviva, to divert all health complaints against Aviva Insurance to Aviva Health, despite that being contrary to the Financial Services and Markets Act 2000 – this neither helps consumers’ confidence in FOS, nor FOS’s unchallengeable power.

A crucial question is how far has Aviva’s misbehaviour gone beyond misleading - the FOS conclusion with respect to the few matters it considered .

Even more important questions are

• what is the FCA going to do about a product that does not provide the protection it offers and
• whether extra charges can escape the regulatory system through wrapping them up in premiums.

WELL THAT’S SEE WHETHER THE FCA ACTS UPON THE WORDS OF THE GOVERNOR OF THE BANK OF ENGLAND.

savemoney

karen10101 is a :spam:mer