Which? today branded the number of complaints wrongly dismissed by banks and other financial providers as shameful.
The Financial Ombudsman Service’s 2008/09 annual review, published today, reveals a record number of complaints to the financial watchdog.
FOS, which settles disputes between consumers and financial companies, has seen a huge increase in complaints about insurance (up 84%) and mortgages, credit cards and consumer credit (up 34%). The total number of new complaints hit a record 127,471.
Key features of the report include:
- A threefold increase in complaints about payment protection insurance (PPI) – following a five-fold increase in the previous year. 89% of PPI claims were upheld.
- Complaints about motor, household and travel insurance rising, but complaints about health insurance remaining broadly level.
- Complaints about investment bonds more than doubling – but pension complaints falling by 9%.
Ombudsman ready for even more complaints
Sir Christopher Kelly, chairman of the FOS, said: ‘The financial world is a very different place now from a year ago – and the ombudsman, like everyone else, has been affected by the economic turmoil.
‘For us it has involved dealing with a significant increase in the number of complaints arising from the impact of the worsening financial climate. As businesses tighten their belts – and the credit crunch leads to increased financial difficulty for many consumers – we are gearing up to deal with further volatility in complaint volumes.’
Treating customers fairly is vital
Which? personal finance campaigns manager, Doug Taylor, says: ‘It’s shameful that some firms are dismissing so many justified complaints that are upheld. This could be just the tip of the iceberg as many people give up at the first hurdle rather than going to the Ombudsman. Companies have a duty to treat their customers fairly and this means giving all complaints due consideration and, if appropriate, accepting them.
‘The increases in complaints about Payment Protection Insurance, credit cards and mortgages reflect the ongoing concerns we have about how companies are treating consumers who take out these products, whether through mis-selling or excessive rates and charges.’
For full details of the Which? payment protection insurance campaign and how to reclaim unfair charges, visit the Which? guide to PPI.
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