Advisers a small number of IFSO complaints

Just eight of the Insurance and Financial Services Ombudsman’s complaints over the past year related to financial advisers – and none were upheld.

Wednesday, September 28th 2016, 6:00AM

by Susan Edmunds

The dispute resolution scheme has released its latest annual report, which shows it received 272 complaints, up from 254 in the previous year and 3193 inquiries across the year, up from 3057.

There were 96 inquiries relating to financial advisers.

Of the eight adviser complaints, two were settled and six were not upheld.

People complained about advisers giving the wrong advice about what a policy covered when they bought it, because they did not have the cover they expected when they were declined, and because they did not believe the adviser fulfilled their duties assisting with the claim.

There was also a complaint relating to the obligations on advisers regarding client reviews and the scope of advice.

In one case, a couple took over ownership of a parent’s life insurance policy but payments fell into arrears.

The insured couple were not aware the policy remained in force, with reduced sums insured.

The adviser, not realising the ownership of the policy had changed, contacted them to discuss the policy – which the new owner said violated the IFA rules of conduct and breached her privacy. The complaint was not upheld.

“What we learn from complaints can prevent similar cases arising in the future,” said Insurance and Financial Services Ombudsman, Karen Stevens.

“Complaints contain lessons about what goes wrong. We publish anonymised summaries of complaints on our website, and we draw on this knowledge when we provide training for the industry and information for consumers about how to avoid future issues.
“By providing this information, we aim to improve the business practices of our participating financial service providers, helping them to help their customers.”

The greatest number of complaints (165 or 61%) related to general insurance, followed by complaints related to health, life and disability insurance (83 or 30%).

Complaints about the Canterbury earthquake made up 37 (14%) of the 272 complaints. In total, the IFSO Scheme has dealt with 179 Canterbury earthquake complaints and 1732 complaint inquiries since 2010.

Tags: IFSO Life insurance