Financial Ombudsman Service chief executive Caroline Wayman has hit out at the “outrageous” uphold rates from complaints against insurers.
Speaking to the Treasury select committee last week, Wayman (pictured) said it was wrong the FOS upheld complaints against insurers in half of cases even after firms had been given the chance to put matters right.
Wayman said she was working hard to improve the reputation of the organisation with advisers.
She said: “Not that long ago I was at an event where an insurer was saying it is outrageous because half the cases are found for us, so that means in half the cases the claims are frivolous. No, it means that we found in their favour by the time it came to us.
“I actually think it is a little bit outrageous that in a market where nothing much is happening, still in half the cases we are needing to say ‘you have done that wrong’ even after they have had the chance to put it right.
“People use the phrase ‘vexatious’, and this happens in payment protection insurance too, when what they mean is someone saying something has gone wrong and the business doesn’t agree. That is not the same as vexatious.”
She added: “For a case to be frivolous and vexatious is a pretty high bar. It is not that you don’t win, it’s that you just don’t have a case and the courts have a similar test.”
Alan Lakey, partner, Highclere Financial Services
It is worrying. If every time a firm received a complaint they paid up, it would encourage more vexatious, spurious and downright fraudulent claims. The FOS is capricious and you cannot know what they are going to do or say.
|FOS uphold rates against insurer complaints|
|payment protection insurance (PPI)||66%||82%||65%||65%|