Waste of time or valid use of service?

rudekid48

Just curious what other posters think.


http://www.ombudsman-decisions.org.uk/viewPDF.aspx?FileID=41252


Basically, policyholder is overcharged by 4p, gets given £25 voucher as apology, then takes complaint to ombudsman looking for further compo.


Is this a valid use of the ombudsman service?

Quentin

There's no such thing as an "invalid" use of the FOS is there?




They set out when they can (and cannot) be used. The complainant must have complied with the rules.


The complainant took a further complaint to the FOS (not the 4p overcharge) And the £25 wasn't just for the 4p overcharge, but for the distress caused by the way the company had behaved over sending inappropriate forms after his cat died

dunstonh

Is this a valid use of the ombudsman service?

I'm not sure anyone can support a system that turns a 4p overcharge (which was corrected) into £575.04. I am sure someone will try though. (Firm has to pay £550 to FOS for the complaint, despite rejection, £25 in voucher for error and 4p correction).

Every other policyholder with them will be paying extra to recover those charges.

Quentin

dunstonh wrote: »

I'm not sure anyone can support a system that turns a 4p overcharge (which was corrected) into £575.04. I am sure someone will try though. (Firm has to pay £550 to FOS for the complaint, despite rejection, £25 in voucher for error and 4p correction).

Every other policyholder with them will be paying extra to recover those charges.

That argument is fallacious.

It isn't down to complainants to consider the £550
The insurer will have referred the complainer to the service available from fos

Whatever the outcome of a fos complaint, the other policyholders pay for the consequences

You don't expect insurers to put unenforceable conditions in their policies and try to tell us when we complain you agreed so suck it, but they do.

The £25 wasn't just for 4p overcharged - you know that but choose to ignore it in your usual biased way when moaning about the fos

dunstonh

The £25 wasn't just for 4p overcharged - you know that but choose to ignore it I'm your usual biased way when moaning about the fos

And with your usual biased response, you consider £575.04 costs for putting right a 4p error justified. £25 for sending the wrong claim form is generous and a very fair response from the firm.

You don't expect insurers to put unenforceable conditions in their policies and try to tell us when we complain you agreed so suck it, but they do.

What has that got to do with this thread?

Whatever the outcome of a fos complaint, the other policyholders pay for the consequences

Yes they do. However, the outcome of this complaint only had one consequence for others. An increased cost.

Quentin

dunstonh wrote: »

And with your usual biased response, you consider £575.04 costs for putting right a 4p error justified. £25 for sending the wrong claim form is generous and a very fair response from the firm.



What has that got to do with this thread?



Yes they do. However, the outcome of this complaint only had one consequence for others. An increased cost.

The complaint that we are discussing is a separate complaint to the original 4p and inappropriate behaviour complaint.

You are majoring on the cost to the other policyholders.

They always have to pay the insurers overheads, including their fos costs.

If insurers always won, then you would have a point. They don't always win.

Were it not for the fos the insurers unfair policy conditions and practices would have to be challenged in court which would mean few could afford to embark on a challenge.

dunstonh

They always have to pay the insurers overheads, including their fos costs.

And you consider it fair that consumers are having to pay more for silly complaints like this?

The complaint that we are discussing is a separate complaint to the original 4p and innapropriate behaviour complaint.

Not going by the FOS feedback. The overcharge seems to be the primary reason along with a consumer credit act form which is outside of the remit of the FOS. Although the FOS could have been a bit more consumer friendly on the response their and state that paying for a product which involves more than 4 payments does require a credit agreement are now required to comply with the consumer credit act.

Were it not for the fos the insurers unfair policy conditions and practices would have to be challenged in court which would mean few could afford to embark on a challenge.

Absolutely. The FOS has its place. However, the funding penalises companies that are doing nothing wrong. A fairer response would be to charge those with upheld complaints a greater amount.

If insurers always won, then you would have a point. They don't always win.

The consumer pays whether the insurer wins or loses a complaint. There has to be a better way of financing the FOS. Maybe only charging firms that have a complaint uphold rate over a certain percentage and increase their cost to make up for the ones that wouldnt be charged. That way, those that are not dealing with complaints fairly get charged for it whilst those that do deal with them fairly and get silly complaints like this referred over do not get charged.

This would also result in fairer firms being able to offer lower pricing for all whilst the firms that dont treat complaints fairly have higher costs which would either hit their product margin or product pricing making them less competitive.

Quentin

dunstonh wrote: »

........Not going by the FOS feedback. The overcharge seems to be the primary reason along with a consumer credit act form which is outside of the remit of the FOS.......

No.

He originally complained to just the insurer in 2012 over 3 matters, the actual overcharge, the credit form and the distress over the way they dealt with his dead cat. All 3 complaints were upheld and he got compensated for the overcharge and distress and didn't have to complete the credit form.

Then in 2013 they did the same thing again at renewal ( overcharged and told him to fill in the form)

He complained again and they corrected the overcharge but insisted on the form being completed.

As these were the same problems from the previous year but with different outcomes (one resolved as previous but the other not) he escalated the complaint. As he will have been advised to by the insurer.

The fos got involved over the 2013 complaint, not the 2012 complaint.

And it looks like the adjudication was over the fos investigator saying the complaint was outside their jurisdiction, so maybe the insurer wasn't charged. (There is no mention of any input to the fos by the insurer in the adjudication)

InsideInsurance

Quentin wrote: »

The complaint that we are discussing is a separate complaint to the original 4p and innapropriate behaviour complaint.

Really? Where did you get that from the document?

There appears to be 4 areas of complaint

1) an actual 4p overcharge
2) a planned 3p overcharge
3) the wrong claim form
4) having to sign a credit agreement

Didnt see anything over their complaints handling problems.

The FOS agreed with complaints 1-3 but left the £25 was sufficient compensation and disagreed with area 4

Unless the rules on funding the FOS have changed then the rates charged are not fixed but vary based on the overall complaints handling process within an organisation. Likewise each organisation get a number of "free" complaints per year as it is inevitable that someone will always escalate complaints even if the company has been perfectly reasonable and fair. If the number of freebies is proportional to the overall number received I cant say as I've never seen the count of complaints -v- freebies to see what sort of proportion arent charged.

I do agree that the ombudsman should exist and its correct that someone should be able to raise their complaint about a 4p charge to them if they dont feel it was handled appropriately. Its very easy to mock or judge it frivolous but having seen a number of complaints and then read the Ombudsman's summation there are often large and important chunks missing.

Personally, I wonder if there was more of an element of it being a systemic issue with this company on the basis that it occurred 2 years in a row. Once could be a freak calculation error, twice starts to sound like a coding problem. Unfortunately the FOS really isnt set up to deal with root cause issues but simply clearing up the mess of what has happened on a case by case basis. Therefore upholding that £25 was reasonable compensation for the 3 accepted issues isnt a surprise to someone in the industry

dunstonh

The FOS fees for cases are as followed - as copied and pasted from FOS site (this is incremental to the FOS levy charged on all FCA regulated firms based on class of business/turnover)

All businesses are entitled to a number of “free” cases. We don’t currently charge a
case fee for the first 25 cases in a year. But we will charge £550 for the 26th and each subsequent case.

The free case count aids small firms but does little for big firms where volume of business means the 26 cases are soon eaten up. For some firms, particularity on the intermediary side of things or subsidiaries, they do not benefit from the 25 cases free as the FOS treats the principle company as having the case count (so companies below that add to the principle count and do not get their own count).

Quentin

InsideInsurance wrote: »

Really? Where did you get that from the document?

Here:


Mr T contacted the business as he was unhappy that he had received another credit agreement and that the rounded up monthly figure would result in an overcharge of three pence over the course of a year. The business agreed to round down the monthly premium to prevent Mr T from being overcharged but said that it was necessary for him to sign a credit agreement due to changes to the Consumer credit Act 1974. The complaint was referred to this service

(There were 5 areas of complaint altogether, but 3 were in 2012. You have missed the one about the dead cat's innapropriate forms.)


The FOS got involved following the 2 new complaints in 2013 which were a repeat of the 2012 complaints overcharging and credit form