INSURANCE FIRMS may face action from the Central Bank after a review of how they handle complaints found that none of the companies inspected were fully compliant with the code of protection for consumers.
Issuing its findings today, the Central Bank said the review was “disappointing” and it was considering further enforcement action against some of the companies in the wake of the report. The bank had a number of actions open to it, including “directions, cautions and reprimands up to and including monetary penalties”.
However, it would take into account the behaviour of the firm subject to sanctions, including the level of co-operation with regulators, and if steps had been taken to ensure the breach would not be repeated.
The survey, which examined more than 600 complaints across 12 companies, found none were fully compliant with the requirements of the Consumer Protection Code, with some showing a particularly low level of compliance.
According to the report, companies breached the code on a number of points including failing to provide consumers with details of an individual point of contact, forcing complainants to detail their issues to different people.
The report identified instances in all firms where they failed to acknowledge complaints in writing within five business days of it being received, and some companies did not acknowledge the complaints at all. Six failed to inform consumers they had the right to refer the matter to the Financial Services Ombudsman, or did not pass on contact details for the ombudsman.
“It is essential that consumers feel they can make a complaint and that it will not be a difficult or prolonged process,” said director of consumer protection Bernard Sheridan.
“The Consumer Protection Code requires that a firm’s complaints resolution process is fair and effective and the findings of this inspection are of particular concern considering the prescriptive nature of the rules contained within the code.”
The financial regulator last year placed Quinn Insurance, one of the country’s largest insurance firms, into administration after its owners “significantly breached” the solvency ratios it is obliged to maintain. The Government last week said a joint venture between Anglo Irish Bank and Liberty Mutual, a leading insurer in the United States, was the preferred bidder for the Quinn group.
