According to the FSO, a significant number of financial institutions continue to deal ineffectively with customer complaints. The FSO has therefore introduced a new approach for dealing with customer complaints “efficiently, fairly and effectively”.
Consumers are required to engage with their financial institution before they refer their complaint to the FSO, while Financial institutions are required to record their efforts to resolve the complaints “comprehensively and fairly” before referring consumers to the FSO.
The FSO has expressed concern over the 150% increase in the number of PPI complaints made, mainly consisting of complaints relating to alleged mis-selling of the product. The FSO reports that the increase in the number of PPI related complaints are mainly as a result of the increasing financial difficulties of consumers, media coverage and the setting up of companies specialising in PPI claims handling.
In order to reduce the volume of complaints in the insurance sector, financial institutions must ensure that they allow “consumers to fully inform themselves of the products they are purchasing and to familiarise themselves with the conditions of their insurance” at an early stage.