British regulator fines IAG’s Hastings $2 million
Troubled IAG-owned UK motor specialist Hastings has been handed a £735,000 ($1.5 million) fine by the UK regulator.
The Financial Services Authority said last week that Hastings failed to treat customers fairly when it cancelled around 4550 incorrectly priced car insurance policies last year.
By agreeing to the penalty early in proceedings Hastings avoided a larger fine of £1.05 million ($2.2 million).
Due to system errors between July and September, the company issued inaccurate premiums that in some cases saved customers more than £500 ($1049) each.
Hastings cancelled the policies but the FSA alleged the company failed to allow “sufficient consideration to paying the premium shortfall to the insurance provider or investigating other possible remedies”.
The FSA also found Hastings invoked a cancellation clause not generally intended for use in such circumstances and said its actions forced customers to take out new insurance at short notice.
FSA Director of Enforcement Margaret Cole says those actions were unacceptable. “It is clear from our investigation that Hastings put its own interests ahead of those of its customers,” she said.
Hastings was ordered to write to affected customers and conduct a review of the relevant compensation.
The Financial Services Authority said last week that Hastings failed to treat customers fairly when it cancelled around 4550 incorrectly priced car insurance policies last year.
By agreeing to the penalty early in proceedings Hastings avoided a larger fine of £1.05 million ($2.2 million).
Due to system errors between July and September, the company issued inaccurate premiums that in some cases saved customers more than £500 ($1049) each.
Hastings cancelled the policies but the FSA alleged the company failed to allow “sufficient consideration to paying the premium shortfall to the insurance provider or investigating other possible remedies”.
The FSA also found Hastings invoked a cancellation clause not generally intended for use in such circumstances and said its actions forced customers to take out new insurance at short notice.
FSA Director of Enforcement Margaret Cole says those actions were unacceptable. “It is clear from our investigation that Hastings put its own interests ahead of those of its customers,” she said.
Hastings was ordered to write to affected customers and conduct a review of the relevant compensation.