Ombudsman gives update after highlighting growth in “black box” complaints in annual review.
The Financial Ombudsman Service (FOS) received “600-700” complaints about telematics insurance products last year, Insurance Age can reveal.
Yesterday (30 May) the organisation’s annual review showed that it had opened 339,967 new complaints across the financial services market for 1 April 2017 to 31 March 2018.
And, as Insurance Age reported at the time, the annual review also flagged the rise in telematics related complaints but did not provide any specific figures.
Insurance-related complaints accounted for 11% of the FOS’ workload while payment protection insurance (PPI) took up 55% of the total.
Motor insurance accounted for 11,887 cases, almost identical to the 11,844 cases the year before.
Excluding PPI, motor represented nearly a third of new insurance complaints.
Technology
The level of telematics-related complaints would put it on a par with legal expenses insurance which had 699.
A spokesperson for the Ombudsman told Insurance Age that the figures for telematics related complaints were imprecise as there was no bespoke line for recording them.
The level would appear low given there are reportedly over a million UK car insurance policies using the technology.
However, rough calculations would put the complaint rate at 0.07% whereas motor (with 11,887 complaints set against say 30 million vehicles) would come in at 0.04%.
The spokesperson explained that it had shone a spotlight on the issue due to the growth in complaints.
A dedicated “new ideas, new challenges” section of the annual review led with a look at the telematics insurance market.
Digital shift
The FOS noted that the shift toward digital, together with other innovations in how services are provided, can help people manage their money – and their lives – in a way that’s tailored to them.
However the organisation also highlighted it was seeing examples of people’s expectations not being met by new technologies.
Turning to telematics the FOS accepted that the technology can help reduce costs, especially for younger drivers.
However it stated it was hearing “from a growing number of people” who believed the data their “black box” had collected was not right.
And that “other people have been told their premiums would increase – or had even had their policies cancelled – because they’d apparently not met the standards their insurer had expected”.Article is care of www.insuranceage.co.uk this article can be found here.
Motor insurance accounted for 11,887 cases, almost identical to the 11,844 cases the year before.
Excluding PPI, motor represented nearly a third of new insurance complaints.
Technology
The level of telematics-related complaints would put it on a par with legal expenses insurance which had 699.
A spokesperson for the Ombudsman told Insurance Age that the figures for telematics related complaints were imprecise as there was no bespoke line for recording them.
The level would appear low given there are reportedly over a million UK car insurance policies using the technology.
However, rough calculations would put the complaint rate at 0.07% whereas motor (with 11,887 complaints set against say 30 million vehicles) would come in at 0.04%.
The spokesperson explained that it had shone a spotlight on the issue due to the growth in complaints.
A dedicated “new ideas, new challenges” section of the annual review led with a look at the telematics insurance market.
Digital shift
The FOS noted that the shift toward digital, together with other innovations in how services are provided, can help people manage their money – and their lives – in a way that’s tailored to them.
However the organisation also highlighted it was seeing examples of people’s expectations not being met by new technologies.
Turning to telematics the FOS accepted that the technology can help reduce costs, especially for younger drivers.
However it stated it was hearing “from a growing number of people” who believed the data their “black box” had collected was not right.
And that “other people have been told their premiums would increase – or had even had their policies cancelled – because they’d apparently not met the standards their insurer had expected”.Article is care of www.insuranceage.co.uk this article can be found here.
