Complaints Bodies

There are a number of complaint bodies a customer can approach should we be unable to resolve their grievance.

• Lloyds Complaints Advisory Department (LCAD)
• The Personal Insurance Arbitration Service (PIAS)
• Financial Ombudsman Service (FOS)

The decision as to who will deal with the complaint is decide based on who the insurer is affiliated with. For example, A Lloyds syndicate insurer will use LCAD as opposed to say Norwich Union who are ABI members and therefore agree as part of their membership to be bound by the FOS.

Arguably the most influential body is the Financial Ombudsman Service (FOS) which was established in 1981 to provide an independent and impartial method of resolving disputes between insurers and their customers. Very few customers are familiar with insurance matters and may therefore start at a disadvantage when in dispute with an insurance company. The FOS attempts to redress this imbalance.

A car insurance customer may not always accept our decision to repudiate a claim and may decide to have their case referred to the FOS. There is no cost to the customer when referring a case to the FOS, however the insurer has to pay a non-refundable fee if the FOS deals with one if its cases.

Decisions on cases referred to the FOS are made by the Ombudsman and Deputy Ombudsman. Before they will consider the case they will write to the Chief Executive of each Insurer offering them one last opportunity to reconsider their decision.

If the decision does not change, the Ombudsman will attempt to resolve the dispute by making an independent and objective decision after considering the circumstances and facts of the case.

The insurance company is bound by the decision of the FOS, but the customer may decide to take it further by commencing legal proceedings against the insurance company to settle the matter in court.

The FOS and other organisations like the ABI ensure that decisions to repudiate claims are made on valid grounds. These organisations prevent insurance companies from abusing the position of power they may have over customers who may be ignorant about insurance matters.