Financial Markets Authority (FMA) – Te Mana Tātai Hokohoko chief executive Samantha Barrass (pictured) believes customer complaints should be approached by insurance companies with an open mindset to see them as opportunities.
Speaking at the IFSO (Insurance & Financial Services Ombudsman) Conference on Fair Conduct in Auckland, Barrass told attendees: “Complaints are ‘moments of truth’ for your relationship with your customers. Handled well, we know they can deepen trust and enhance customer experience and customer advocacy. Handled badly, they are ticking time bombs for your customers and your reputation.
“Customer confidence in the quality of your complaint resolution is an important part of a strong consumer protection regime. That is why we are so interested in how you support customers to resolve matters when things go wrong.
“So, I am encouraging you to adopt a genuinely open mindset to customer complaints – to see them as the gold they are, an opportunity not only to deepen trust within your relationship with customers, but also to surface more systemic issues within your organisations.”
In the CEO’s view, links to an insurance provider’s complaints process should be clearly available to customers, instead of them being buried in the terms and conditions. Policyholders must also be informed about how to contact the relevant dispute resolution scheme.
“When complaints reach an impasse, as they sometimes do, this is where the work of the dispute resolution schemes is important – to work through issues and complaints that cannot otherwise be resolved and giving customers the forum of an independent third party if they have reached deadlock,” she said. “It’s essential that customers understand that is an option.”
One such scheme is the IFSO, the strength of which is its neutrality.
In her keynote, Barrass also pointed to the role that customer complaints play in offering learning opportunities for organisations.
The FMA chief executive said: “Complaints are your best opportunity to put things right, before you lose that customer. We also encourage you to think of complaints as a rich source of data, intelligence, and insight. For example, they can be very useful indicators on where friction points are consistently occurring.”
The key, according to Barrass, is looking at the bigger picture of the complaints data.
“Is it being analysed for systemic issues or recurring pain points with your customers?” she said. “How is that fed back into the decision-making of your firm?”
Her advice is to regularly analyse the information for trends and identify indications that a process issue needs to be addressed.
Following the Auckland floods and Cyclone Gabrielle, Barrass believes that how insurance companies manage complaints in the long tail of the recent extreme weather events will be critical.
“An area like complaints resolution is a good place for firms to demonstrate how they are open and transparent with their customers on dealing with things when they go wrong or a customer isn’t wholly satisfied,” she said. “This is an important part of delivering fair outcomes to your customers and something we will remain very interested in.
“But, fundamentally, I am encouraging a genuinely open, non-defensive mindset to complaints – surface them; do not try to minimise them. This doesn’t just mean having a process in place; it also means being bold and proactive about showing customers how and where to resolve issues.”
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