The number of disputes lodged with the Financial Ombudsman Service (FOS) increased 1% to 31,895 last financial year.

The service accepted 23,344 cases, down 0.4%, and closed 34,714, up 4% from the previous year. It also resolved 52 systemic issues.

General insurance accounted for 26% of disputes lodged, the second highest after credit issues (49%), while life insurance accounted for about 5%.

FOS investigated 347 alleged breaches of industry codes of practice, with 238 confirmed.

General insurance cases accepted grew 1% to 6780, with most disputes (94%) involving domestic policyholders.

“The increase was driven by a one-third rise in travel insurance disputes, to 855 in 2014/15,” FOS says. “The main issue was denial of claim – exclusion/condition.”

The biggest areas of complaint were motor vehicle comprehensive policies (38%), followed by home building (23%), travel insurance (13%) and home contents (8%).

About 65% of domestic insurance disputes were triggered by unhappiness with an insurer’s decision to reject a claim.

There were about 257 disputes between general insurance brokers and their customers, compared with 256 the previous year. “The main issue was denial of claim,” FOS says.