Insurance and pure protection was the second most-complained-about sector in UK financial services in the second half of 2025, with 665,370 complaints recorded between July and December, according to revised data published by the FCA. That figure represents a 4.6% decrease from 697,635 in H1 2025. Across all financial services, the regulator recorded 1.74 million complaints opened in the period, a 0.4% fall from the first half of the year.
The directional picture - falling complaints across insurance, falling complaints across most of financial services - is broadly positive. But brokers advising firms on regulatory risk should understand exactly what produced it, because the revised figures look significantly different from the data the FCA first published.
On May 15, the FCA updated both its H1 and H2 2025 complaints data after investigating a reporting anomaly in one firm's complaints return. The original H2 2025 data showed insurance and pure protection complaints increasing by 10.1% from H1, with motor complaints rising by more than 33%. The revised data reverses that picture entirely: insurance fell 4.6%, motor fell 7.8%.
The revision corrected a single firm's over-reporting error. The effect was to shift the sector's headline story from meaningful deterioration to meaningful improvement. That is not a minor numerical adjustment - it is a complete reversal of the directional trend for the UK's second-largest complaints category.
For any insurer or broker that benchmarks internal complaints performance against FCA aggregate data, the revision is a reminder that published aggregate figures represent a snapshot at a point in time and can shift significantly after initial release. Firms whose internal data was tracking closely with the original H2 figures - apparently in line with a rising market trend - are now benchmarking against a market that, on revised numbers, moved in the opposite direction.
Motor and transport remained the most-complained-about insurance product in H2 2025 with 215,708 complaints, even after the downward revision. The product accounts for close to a third of all insurance complaints in the period. The FCA's February 2026 regulatory priorities report for the insurance sector said too many consumers have poor claims experiences and that the regulator would actively monitor claims handling outcomes.
For motor specifically, that scrutiny sits alongside Motor Insurance Taskforce findings on replacement vehicle costs, longer repair times and bodily injury claim complexity as the primary operational drivers behind complaint volumes. A 7.8% fall in motor complaints is positive, but the underlying cost and complexity pressures have not resolved - they have moderated within a six-month window that does not capture the full trajectory of the current repair cost cycle.
For brokers placing motor business, the practical renewal question is not whether industry-wide complaints fell, but whether the specific insurer on a client's renewal has a claims handling track record that compares favourably with the sector. The FCA's firm-specific complaints data, published alongside the aggregate release, is the more granular tool for that assessment.
While every other insurance product saw complaints fall in H2 2025, travel insurance went the other way. Travel complaints rose 19.4% from 27,813 in H1 2025 to 33,199 in H2 - the only insurance line to record an increase in the period.
That increase is consistent with Financial Ombudsman Service data covering a similar period. Travel insurance complaints referred to the FOS rose 58% year-on-year in Q3 2025, one of the highest quarterly totals outside the immediate post-COVID period. The FOS linked the increase to declined claims, delays in settling claims, and travel disruption from Middle East conflict. The H2 2025 FCA data suggests that firm-level complaint handling has not fully absorbed that demand.
The Consumer Duty requires firms to demonstrate fair outcomes in claims handling, not just in pricing and product design. For travel specifically, a 19.4% rise in reported complaints against a backdrop where the FOS is also recording elevated referrals is the combination that draws regulatory attention. A broker placing travel cover for corporate or retail clients whose policies are administered by an insurer with high claims decline rates or poor communication standards during disruption events faces the same client complaint risk whether or not the FCA data captures it.
Total redress paid across all financial services in H2 2025 was £236 million, down 16.9% from £284 million in H1 2025, with the average redress payment on upheld complaints falling from £238 to £215. The upheld rate across all sectors fell from 57.88% to 55.54%, meaning slightly fewer complaints were resolved in favour of the complainant.
James Tattersall, senior director at complaints management consultancy Huntswood, noted that complaints in financial services have remained between 1.7 million and two million per six-month period for five consecutive years. His firm found that the average insurance and pure protection organisation handled 4,058 complaints in the period - the highest of any financial services sector outside banking and credit cards, where the comparable figure was 15,360. "Firms across all sectors need solutions and strategies which can help address the ongoing challenges," he said.
