The external dispute resolution service received 30,479 disputes in the 2016-17 financial year, a 16 per cent increase on the previous year and a new record, FOS said in its annual review.
Of these, 22,475 disputes were accepted – an 11 per cent increase on the number of those accepted in the previous corresponding period; only 4 per cent of these (1,018) were life insurance disputes.
“The increase in 2016-17 was driven by an increased consumer awareness and a continuation of industry-specific issues in general insurance,” the review said.
“These include a higher number of claims, organisational changes and outsourcing, all of which may have affected insurers’ internal dispute resolution.”
General insurance accounted for 38 per cent of the overall increase in disputes received by FOS, with deposit-taking disputes also seeing a “large rise” throughout the year, the review said.
While the number of disputes received by FOS grew, the number of those disputes that were resolved after then being sent back to the financial service provider’s internal dispute resolution system also grew, from 36 per cent to 43 per cent.
“This highlights the value of financial services providers considering disputes before we become involved,” the review said.
Better get ASIC on the case. Introduce 50 page SoA and a best interest duty for motor vehicle insurance. What about the churn scandal on all those home content policies?!! All this monitoring and supervision could be paid for with a small levy on the industry. To all you doubters who say this approach won’t achieve anything except increased costs, I say nutz! Trust ASIC, your betters know best. They have years of experience making the financial planning industry much more user friendly, efficient and cost effective. Problem solved.