The Financial Services Complaints Limited (FSCL), a Financial Ombudsman service, is witnessing a surge in complaints stemming from the recent severe weather events that impacted Aotearoa New Zealand this year.
“We are beginning to see more weather-related complaints against financial service providers in the wake of the Auckland floods and Cyclone Gabrielle. These range from delays in insurers assessing claims, complaints that insurance brokers didn’t arrange appropriate insurance cover for homes and businesses, and consumers struggling to make loan repayments due to financial hardship,” financial ombudsman Susan Taylor said.
Some consumers, already vulnerable due to the rising cost-of-living and increased inflation, are now facing financial stress following these weather-related incidents. Taylor said that this underscores the importance of independent dispute resolution services.
“We understand this is a stressful time for those who have been impacted. If something has gone wrong with a financial service following a weather-related event, there is free, accessible help through a dispute resolution service. As well as FSCL, there are the Insurance and Financial Services Ombudsman (IFSO), the Banking Ombudsman Scheme (BOS) and the Financial Dispute Resolution Service (FDRS),” she said.
Changes announced for the IFSO Scheme are expected to make it so that more consumers can enjoy free dispute resolutions, as revealed a few weeks ago.
Taylor also encouraged consumers to communicate with their lenders at the earliest sign of difficulty in making loan repayments. Timely communication with the lender increases the likelihood of finding a solution.
“As extreme weather events become increasingly common in Aotearoa, more consumers will find themselves unable to rebuild their homes as a result of their sum insured value being set too low,” Taylor said. “With building costs continuing to rise, and inflation remaining steady, it’s important that consumers regularly review their sum insured. Insurers and brokers could also remind consumers to review their sum insured more often and send out standalone reminders rather than including them at policy renewal.”
What are your thoughts on this story? Please feel free to share your comments below.