CONSUMERS ARE making 20 complaints a day about banks, insurance companies and other financial service providers, new figures show.
Financial Services Ombudsman Bill Prasifka, who released the figures yesterday, called on institutions to do more to resolve customer complaints at an earlier stage. Mr Prasifka said 3,600 complaints were lodged with his office in the first six months of the year.
The number, while still near record levels, represents the first fall in complaints since the start of the recession.
The ombudsman ordered financial institutions to pay out a total of €1.3 million to people during the period.
Mr Prasifka said his office was reaching the limit of the number of decisions it was capable of making unless financial institutions did more to resolve cases earlier. He said he had asked Government for a small increase in staff but was mindful of the “economic realities”.
Just one-quarter of decisions made by the ombudsman went in the complainant’s favour, figures show. Almost three-quarters were not upheld, and 1 per cent went to mediation. An unknown number of other complaints may have been resolved at an earlier stage.
Almost half the complaints received were about insurance, one-third were in the banking area and 17 per cent related to investments and pensions. More than 50 per cent of the awards made, €741,000, related to investments.
Products which most commonly led to complaints in banking were accounts, lending policies and mortgages. The most frequent causes of complaints were maladministration and customer care, disputed balances and transactions, and repayment or settlement terms.
Causes of complaint in insurance included the repudiation of claims, the handling of claims and maladministration.
In the areas of endowment policies and review of life policies, the ombudsman has received complaints about policies that were sold 20 or 30 years ago.
However, under existing legislation, he is unable to investigate the sale of products, or actions, that took place more than six years ago. Complaints about the ongoing review of such policies or their performance can still be handled if they fall within the six-year limit.
Complaints about home insurance grew 48 per cent on 2009, largely due to the bad weather last winter. Mortgage and payment protection insurance complaints were up 79 per cent.
High Court cases taken against decisions by the ombudsman have fallen, but still stand at over 20, according to Mr Prasifka.
He repeated earlier calls to the Government for powers to allow him “name and shame” financial institutions against which findings are made.
Overall, consumers made over 11,520 phone calls to the ombudsman’s office, while 42,000 visits were made to its website.
Cause for concern: problem areas
ATMs:Problems caused by the fraudulent withdrawal of money from ATMs remain as prevalent as in previous years, according to the ombudsman.
Most of these complaints arose when banks refused to reimburse money because the pin was used in the fraud.
Bill Prasifka, who upheld one-third of complaints and rejected the rest, said it was essential that cardholders safeguarded their pin numbers and reported any fraud to their bank immediately.
Stamp duty on credit cards:A recurrent cause of complaint is the €30 Government levy on credit cards. This is collected in arrears for any credit card account in existence for any part of a year, running from April 1st to March 31st. Thus, complaints from consumers about the charge being imposed after they had closed an account generally were not upheld.
Household building and contents insurance:Complaints here were up 48 per cent, mostly because of last winter's bad weather. As the ombudsman points out, "not all eventualities that befall an insured are covered under the terms of their household policy". Loss or damage must be caused by an "insured peril" as stated on the policy; this could include fire, storm, theft, etc. Just one out of 12 complaints about household contents, and seven out of 55 about buildings, were upheld. The onus is on the insured person to prove an insured peril occurred.
