Financial advisers just 2% of IFSO complaints

Financial advisers might be in the regulators’ sights, but they make up a very small percentage of complaints to the Insurance and Financial Services Ombudsman.

Wednesday, August 29th 2018, 3:00PM

The scheme has released its annual report today, which shows that just seven complaints of the 320 it dealt with were about advisers. Complaints related to fees and charges, whether reasonable care was taken, and the standard of service.

Another 108 inquiries were received about advisers, or 3% of the total inquiry workload.

IFSO dealt with its highest number of complaints since 1998 in the past financial year.

Most were about general insurance, followed by health, life and disability insurance, at 31% of complaints.

“There will always be complaints, but learning from them is immensely valuable as a means to improve conduct across the entire sector and reduce reputation risk,” said ombudsman Karen Stevens “Complaints help to inform and educate the industry, with the aim of avoiding customer dissatisfaction.

“We see very few complaints about financial advisers. We know that the unique relationship advisers have with their clients means that advisers do their best to resolve issues at the earliest stages, so very few are escalated or result in a complaint to the IFSO Scheme. That is why the training and support we offer our members focuses on helping advisers resolve client dissatisfaction as early as possible – this is best result of clients and advisers.”

She said the complaints that were investigated included good lessons for the industry.

“Advisers should be aware of their legal obligations and have the documentation to demonstrate they meet these obligations. Conduct risk is top of mind for everyone in the financial services industry and measuring themselves against the complaints to the IFSO Scheme is the best way our Participants can ensure they are meeting acceptable standards of conduct and behaviour.

“Given the FMA’s focus on replacement business and adviser conduct, advisers will be under increasing scrutiny. The advisers who follow best practice, with good records and clear statements of advice will be able to respond to any review or client dissatisfaction more effectively. However, all clients have the opportunity to make a complaint and this feedback can be helpful to improve client communications and avoid issues arising in the future.”

Tags: IFSO