I want to make a complaint! - January/February 2015

What is a complaint and how to deal with complaints are fundamental to how financial services firms like insurance companies are regulated.

Twice a year we have to submit complaints data to our regulator, the Financial Conduct Authority (think Ofsted with swingeing powers to fine and disbar us). Not surprisingly, we have paid great attention to the complaints process. If it is not clear from your insurance policy how to make a complaint then that policy has not been written properly.

What is a complaint? Broadly speaking, there are two types of complaint. Firstly, the service you received was poor. Secondly, the policy you were sold was inappropriate for your requirements or was not as advertised or described. The second type of complaint is usually the more serious since it concerns policy cover and can potentially leave a client without the correct insurance.

A missold policy usually comes to light at the claims stage. An incident occurs which you believe should be covered and, when you try to claim, you are told that it is not covered. There are various ways you could have been missold a policy. You might have been given erroneous information on the telephone; the product summary and guide might have been wrong or misleading; you might have been missold add ons to the policy without even realizing they were optional.

The first thing you need to do is identify how you believe you have been missold the policy. All policies contain exclusions and conditions and the most significant of these should have been pointed out to you in the Summary and Guide given to you during the sales process. Was the Summary unclear? For instance, did it say you were covered for property anywhere in the UK when in fact you were only covered for property at your premises? Were you led to believe that the policy would cover you for off site activities like kayaking when in fact you weren’t?

The company should immediately respond to your letter, setting out the procedure and timescales for dealing with your complaint. They will need some time to investigate complaints, since it will probably involve looking back at all letters and documents they sent you and checking that everything was done according to the rules. The company may contact you to find out further information and it is very much in your interests to cooperate at this stage to ensure a speedy conclusion to the complaint.

Once the company’s investigation is complete they will write you a final letter. Either it will accept your complaint and make proposals for rectification. Or they will decline your claim. If they decline it the company must give you clear reasons as to why it doesn’t agree with you.

They must also advise you that you may be able to escalate your complaint to the Financial Ombudsman Service. FOS will not usually get involved until you have received a final letter from the insurance company and usually only deal with smaller companies and individuals. Their aim is to resolve disputes amicably and their decisions are binding. If they believe that the company has dealt with you unfairly or incorrectly they do have the power to compel the firm to recompense you. On the other hand if they believe that the company has treated you fairly they will advise you accordingly.

Insurance companies have well developed complaints procedures that are there to ensure a fair and speedy response to your complaint. If both the complainant and the company stick to these procedures, there is no reason why Complaints should degenerate into hostility.

Jerry Beere is director at Morton Michel.