In the Financial Conduct Authority’s (FCA) Regulation round-up for June, it published details of its findings of the thematic work conducted on complaints handling. The market based thematic work was carried out in advance of the new rules for complaints handling.
In December 2014, the FCA issued its consultation paper CP 14/30 Improving Complaints Handling seeking the views of financial services firms on its proposed new rules.
Aimed at improving firms’ identification and handling of complaints, the FCA proposed:
- Extending the “next business day rule” to three business days.
- Requiring firms to report all complaints (including those handled by the close of three business days).
- Requiring firms to send a “summary resolution communication” to consumers when their complaint is resolved within three business days after date of receipt.
Currently, the complaints handling rules under the Dispute Resolution: Complaints Source book (DISP) in the FCA’s Handbook, do not apply to firms if a complaint is resolved to the satisfaction of the complainant by the close of the next business day after which the firm received the complaint.
The final rules confirming these new requirements were published in the FCA’s policy statement1 in July 2015 and come into force on 30 June 2016.
The recent thematic work found that complaints were generally handled well by insurance firms once they were identified. However, the FCA did recognise areas for improvement:
- All complaints which expressed dissatisfaction and met the FCA’s definition of a complaint must be recorded and dealt with in accordance with the DISP rules.
- Better correlation between a firms’ analysis of the root cause of a complaint and the actions taken to address the issues identified as the cause(s). Root cause analysis should address what firms identify to be the key issue(s) and resolve systemic problems in their complaints handling processes.
In light of the FCA’s overall findings, it would seem that firms will successfully adapt to the new rules and continue to resolve complaints in the best interest of consumers.