Claimants complain more, insurers win more
The number of disputes over personal lines insurance is on the rise, but the Insurance Ombudsman Service (IOS) reports that more of its decisions are going the underwriters’ way.
About 16,500 disputes were dealt with in the industry’s internal dispute resolution process during the 2005/06 financial year – up more than 30% on the previous 12 months. Of these, 1870 were referred to IOS for a final, independent determination.
Ombudsman Sam Parrino says nearly half involved motor insurance products and claims. The total number of motor claims fell 6%, but the number of claims originally rejected rose nearly 58% to 5132 over the year.
The number of home insurance claims rejected in the first instance rose 21% to 26,990, with a 44% increase in the number of disputes.
Rejected travel insurance claims increased more than 200%, resulting in more than 1900 disputes. Unlike motor and home insurance disputes, nearly all travel insurance issues related directly to a claim.
The proportion of disputes going to the ombudsman for final resolution remained roughly the same across all three classes. However, Mr Parrino noted an 8% increase in the number of judgements in favour of insurers.
He says the figures show the dispute resolution process is working, but insurers can do more to fully explain their policies to customers.
“We are aware of the areas, particularly in travel, in which we are seeing growing dispute numbers. We are working with consumer groups and the industry to encourage greater clarity and explanation of policy wordings during the sales process to minimise consumer dissatisfaction.”
About 16,500 disputes were dealt with in the industry’s internal dispute resolution process during the 2005/06 financial year – up more than 30% on the previous 12 months. Of these, 1870 were referred to IOS for a final, independent determination.
Ombudsman Sam Parrino says nearly half involved motor insurance products and claims. The total number of motor claims fell 6%, but the number of claims originally rejected rose nearly 58% to 5132 over the year.
The number of home insurance claims rejected in the first instance rose 21% to 26,990, with a 44% increase in the number of disputes.
Rejected travel insurance claims increased more than 200%, resulting in more than 1900 disputes. Unlike motor and home insurance disputes, nearly all travel insurance issues related directly to a claim.
The proportion of disputes going to the ombudsman for final resolution remained roughly the same across all three classes. However, Mr Parrino noted an 8% increase in the number of judgements in favour of insurers.
He says the figures show the dispute resolution process is working, but insurers can do more to fully explain their policies to customers.
“We are aware of the areas, particularly in travel, in which we are seeing growing dispute numbers. We are working with consumer groups and the industry to encourage greater clarity and explanation of policy wordings during the sales process to minimise consumer dissatisfaction.”