ABI kicks-off IP review
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The Association of British Insurers has kicked-off work around its review of the income protection market by forming a working group to look at the number of complaints made to the Financial Ombudsman Service.
Assistant director of health and protection Nick Kirwan says the Income Protection Working Party, made up of 12 IP providers, will look at why the number of IP complaints to the FOS is greater than critical illness complaints when more CI is sold.
The evidence will go towards the ABI’s Income Protection Statement of Best Practice, which will be reassessed in 2010, five years since its last review.
FOS data shows that there were 774 IP complaints last year compared to 586 CI complaints.
But Kirwan says: “I would like to understand what those complaints are about. It maybe that there has been some misclassification by FOS on IP plans, it maybe that there are more IP claims per customer or it could be the growth of claims management companies.
“It could be any number of things driving this but until I know what it is I don’t feel comfortable sitting there looking at a statistic where I can see the number of complaints going up and not understanding what is causing that.”
The working party has so far held two meetings, the first on September 24, and plans to hold a meeting every two weeks. The ABI is expected to ask members to pull their IP complaints cases together to determine why these are so high and what can be done to drive these down in the best interests of the customer.
Also as part of the review, Kirwan says question whether IP can play a bigger role in delivering part of state benefits. He says: “A future government of whatever shade is going to be faced with some financially challenging decisions. So can the private sector play a role in the nation’s financial security, and could it play a role in the provision of some of the state benefits, and what would or could that arrangement look like.”
The FOS says: “We are not able to comment on ongoing work and correspondence with the ABI. However we are pleased that health and medical insurance is the one area across the board where complaint numbers are actually falling. This is because of ABI work to align the industry with our position on best practice and complaints handling.”
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