FSA backs complaints handlers

EdInvestor

Regulator tells insurers told they can't refuse to deal with independent companies if policyholders have appointed them to handle endowment complaints.

Daily Mail report

FOSman

Mate, I don't know if you read the article, but it says that they couldn't condone the action by life companies not dealing with complaint handlers.

The FSA did not back or promote the handlers.

I'm not going to go into a rant here as to why I hate these firms, mainly because I know some firms do a good job, and make a worthy contribution.

Reality check on this situation. FSA at the moment can't stop these firms getting involved, but I believe that there are organisations lobbying to have them regulated.

FOSman

Have a read of what the FOS says:

do I need to employ someone to handle my mortgage endowment complaint for me?
No. Financial firms have to handle mortgage endowment complaints according to guidelines set out by the industry regulator, the FSA. So you should not need any special help or support if you complain.

The ombudsman service is a free and informal way of getting disputes resolved, if you remain unhappy with how a firm has handled your complaint. We decide if a complaint is valid by looking at the facts of the case - and we prefer to hear from you in your own words.

Our statistics show that there is no difference in outcome between complaints that claims management companies (sometimes called "no win, no fee" agencies) bring to the ombudsman service on behalf of consumers, and complaints that consumers bring direct to us themselves. In other words, we are no more or less likely to uphold a complaint referred to us through a claims management company.

If you decide to employ someone to handle your complaint for you - for example, a claims management company - you will have to pay their costs yourself. This could mean paying them part of any compensation you have been awarded.


http://www.financial-ombudsman.org.uk/faq/mortgage.htm#7

defender_of_the_weak

FOSman I have written to your boss about the statement in your annual report as it bears no relation to my reality.Based on the anual report 'in 36% of cases we found the company had not treated the customer fairly'. We have an uphold rate of 88% of cases we file with FOS including a number of previously adjudicated cases that we have appealed and had overturned.

The use of this statement is just another tactic to stop people getting what they should. The big institutions wheel in companies of experts, actuaries and claim handlers, and these contracts are invaribly decided on who can keep my cost down (pay as little as possible). When Mr Average does the same they cry foul, stick their fingers in their ears and go la la la, with the idea that the nasty complaint handler goes away.

Yep, I think claims handlers should be regulated.

The biggest example of unfair treatment is the application of time bars, they don't really exist but the FSA continue to let them get away with this one.

EdInvestor

I am afraid it is hard to give credence to the Ombudsman's objectivity following the disgraceful way it has dealt with the widespread misselling at Equitable Life.

Victims there have been given the runaround for years.

The big institutions wheel in companies of experts, actuaries and claim handlers, and these contracts are invaribly decided on who can keep my cost down (pay as little as possible). When Mr Average does the same they cry foul, stick their fingers in their ears and go la la la, with the idea that the nasty complaint handler goes away.

Quite.It ill behoves FOSman to support the industry - which contains the likes of Abbey, which has recently been required to review ALL its endowment complaints because 90 per cent of them appear to have been rejected wrongly.

Yep, I think claims handlers should be regulated.

And so do I. Let's level this playing field, so the policyholder has some firepower on his side as well.

dunstonh

That article doesnt say that the FSA backs complaint handlers. It just says that the FSA have told providers that they cannot disregard complaints that come through complaints firms. Quite a reasonable stance from the FSA really as it shouldnt matter where the complaint originates from.

It is fair to say that there are some complaints companies that have abused the complaints process to put in spurious complaints and actively encourage complaints when there has been no grounds to. It is those companies that have tarnished the reputation of the ones that havent. DOFW will recall my view of complaints companies when he first posted here. I have revised that view thanks to his posts but just like a minority number of financial advisors have spoilt the reputation of the industry, it appears a number of these complaints companies have done the same for there side.

When an insurance company has had a complaint in from a company in a format that they have listed everything possible that could be classed as mis-sale, whether it was or was not, and its the same format they have seen with all the other complaints from that company, it doesn't make their job to see if a mis-sale took place very easy. Indeed, there have been suggestions that it makes it more likely to be declined. So, you can see why they took to rejecting these style of complaints.

EdInvestor

Have complaints companies started to represent investors with complaints about other products yet, or are they still handling just endowments?

FOSman

EdInvestor wrote:

Have complaints companies started to represent investors with complaints about other products yet, or are they still handling just endowments?

Yep, I believe so. I have seen IFAs represent clients in complaining against other IFAs.

FOSman

Mis-sale stats

Nobody yet knows how many complaints are being upheld against who, as the nobody is collecting that type of information. However, the FOS are about to roll-out a new complaints handling system that will collect stats on firms & 3rd parties, and feed that back to the FSA.

We can then look forward to more firms being fined like Abbey.

:mad:
I get very frustrated everyday when I see how people are being treated by firms after they complain. Unfortunatly, the FOS can't do much about it. They have very little power and can't punish anyone. That it the FSA's job.

defender_of_the_weak

So if nobody has any stats, how come the FOS annual report suggested that you were no better with a third party than doing it yourself, which started this latest round of dodging the issue.

I have written to both Brad & Bingley and one of the networks that have taken this stance and told them that if this assertion can be supported we would accept their decision to deal direct. Do you know, neither of them have volunteered the figures.

As for other polices, yes. We regularly take on non endowment cases such as bonds, life cover, unit trusts, PEP/ISA and pension cases.

dunstonh

Stats were also posted some months back showing what the source of advice was (IFA or tied) and what the upheld rate was against each category.