More than half of all new complaints dealt with by the Financial Ombudsman Service in 2010 related to Payment Protection Insurance.
The latest FOS complaints report shows that the PPI misselling issue is still a major area of consumer detriment, and in light of the recent High Court ruling – which went against the banks – the financial sector faces a deluge of further claims. PPI complaints accounted for 51% of new cases in 2010, with the number more than doubling to 104,597 – the highest total ever received in a year about a single financial product.
The Financial Ombudsman Service results chime with the recent High Court ruling that the banks have been misselling PPI for years; a decision that the providers have decided not to challenge.
If you think you were mis-sold PPI, visit our online guide to getting your money back and use our free PPI reclaiming tool to start the process.
General insurance complaints
General insurance also came under the spotlight, with the number of complaints regarding travel and car insurance increasing. Examples of bad practice included a valid claim for the loss of a stolen car being rejected by an insurer.
Specialist insurers also were revealed as following bad practice, with mobile phone insurance being identified as a poor value product.
At the other end of the scale, complaints about investments have fallen, while the proportion of complaints upheld in favour of the consumer has risen.
Busiest year in a decade for complaints
Natalie Ceeney, chief executive and chief ombudsman, said: ‘This year has been the busiest in our ten-year history – with over 200,000 disputes referred to us and a million front-line enquiries. This reflects the increased confidence of an ever more diverse range of consumers getting in touch about a wider range of problems and issues.
‘Aside from PPI cases, over the year we’ve seen encouraging signs of improvements in the way that some businesses are handling complaints – and it’s good to see that the number of disputes about some other financial products has now started to fall.’
Which? applauds the FOS
Which? executive director, Richard Lloyd said: ‘There is clearly a serious problem with complaints-handling in the financial services industry. Never before has the Ombudsman’s role been so vital – the Government must resist any pressure from the industry to weaken it.
‘The fact that over 200,000 people a year are now having to refer their complaint to the Financial Ombudsman Service – the last port of call – shows that banks and insurers are simply not taking complaints-handling seriously enough.
‘In the very worst cases, firms are seeing more than 90% of cases that go to the Ombudsman being upheld – clear evidence they do not understand the meaning of treating customers fairly.’
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