Insurers failing dissatisfied customers


Insurers need to do more when it comes to customer complaints after new data has revealed that the number of upheld complaints remains stubbornly high.

According to the Financial Ombudsman Service (FOS), upheld rates for insurance complaints was 34% in the third quarter of 2023.

This was the third quarter in a row that upheld rates were higher than a third, with emergency cover the worst performing business line at 46%. Meanwhile, upheld travel insurance complaints was 44%.

The data also revealed that motor insurance was the most complained about business line, with more than 4,000 complaints accounting for 39% of the total number.

Insurance DataLab co-founder Matt Scott said: “This is a really worrying trend for the insurance industry, particularly with the regulatory focus on customer outcomes in the wake of the new Consumer Duty regulations. Having more than a third of complaints upheld by the ombudsman should be unacceptable for any insurer, and with so many business lines demonstrating such a high upheld rate I would not be surprised to see some form of regulatory action later this year.

“The FCA has made it clear that monitoring complaints data is an essential part of the new regulations, and this demonstrates just how much still needs to be done to bring the industry in line with customer expectations.”

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