The Insurance & Financial Services Ombudsman Scheme has reported 3,922 enquiries over the past year and has investigated 282 complaints, according to its 2019-2020 annual report.
IFSO noted that although the total number of enquiries has gone up since the last report, the number of investigated complaints about general insurance saw a decrease (163, down from 225 the previous year).
Sixty four per cent (64%) of all enquiries in 2019-20 were about general insurance, 14% were related to life, health and disability policies, 12% were related to loans or credit contracts and 4% were about financial advisers. The IFSO Scheme also received 230 COVID-19 related enquiries as of June 30, and IFSO Karen Stevens says this highlights the growing need for access to free and independent advice.
Despite this however, she says that complaints which the IFSO Scheme refers back to insurers are now being resolved more quickly and settled more often - a “good sign in terms of the customer experience.”
“Misunderstanding and miscommunication continue to be common complaint themes,” Stevens commented.
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“Communication and transparency are even more important in the current climate. The best time to understand insurance is before you need it - every day we hear about problems that could have been avoided if people had been better informed. That’s why we’re sharing real stories about real complaints.”
IFSO has published a series of example complaints in its latest report, including a travel insurance claim where the customer was unaware of its exclusion of pandemics under the policy wording. The IFSO Scheme case manager noted that the policy exclusion was broad, and included the “threat of a pandemic” or a “likely pandemic” - however, after discussions with the scheme, the insurer offered to cancel the policy and reimburse the customer’s premiums.
Stevens says it is important for customers to understand that insurance won’t cover for every risk, and urged them to familiarise themselves with their policy before making any purchases.
“While insurance won’t cover everything, there are steps you can take to help prevent future issues,” she said.
“For example, check your policy for exclusions, limitations and requirements; keep receipts and records; take photos of damaged property; tell all, and tell the truth. These are the kind of tips we share on our new website.”
“The aim is to help consumers understand their options and their responsibilities, so they can make informed choices,” Stevens added. “Perhaps the most important tip is to keep asking questions until you understand, and always ask for extra assistance if you need it.”
Commenting on the 2020 report, IFSO Scheme Commission Chair Sue Suckling said that the COVID-19 pandemic has “highlighted the strength of collective action” and flexibility, and the IFSO Scheme will be playing a vital role in “building confidence and trust” and ensuring that the interests of consumers are being looked after.
“The emphasis on conduct and culture set the scene for a proactive response to financial hardship and vulnerability,” Suckling said.
“Insurers and financial service providers responded quickly under pressure, operating during lockdown, and putting a range of measures in place to increase customer support. In this climate, access to a free and independent dispute resolution service is even more vital.”
“Our strategic goals involve embracing technology to enable and build relationships,” she added.
“The best way to create a more responsive and accessible service is together with the industry. We have responded to the changing needs of our participants and their customers with initiatives to improve access, information and resources.”