Watchdog claims PI firms are pressing IFAs on complaints
The Financial Ombudsman Service believes that IFAs are being forced by their professional indemnity insurers to refer client complaints to the FOS because the insurers want legal certainty.
FOS spokesman David Cresswell says: “IFAs are often forced to go to the ombudsman by professional indemnity insurers looking over their shoulder wanting to get legal certainty. They feel disempowered. They have a client that is unhappy but they think they have to refer everything to the PI insurer.”
The FOS is calling on IFAs to combat this problem by taking a more “constructive” approach to complaints.
Cresswell says: “IFA should make sure they send clients good letters to keep them well informed of what is going on. They also need to get involved earlier so false expectations are not built up.”
He says the watchdog is also working to address its “challenging relationship” with IFAs who are reluctant to pay a case fee and put out a more positive message in the market. “We do not have contact with 80 per cent of IFAs because they do not make complaints so we see an unrepresentative sample of IFAs. There are lots of good stories out there and we want to do a lot more work with IFAs to send a more positive message out.”
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