PPI Claims Charter by ABI
The Association of British Insurers (ABI) is preparing to draw up a “claims charter” for the insurance industry to try and boost consumer confidence in the market.
Nick Kirwan, head of health and protection at the ABI, said the charter will cover all types of protection products and may extend to private medical insurance and payment protection insurance. It is likely to take the form of a guarantee from insurers, which promises to treat customers fairly when they make a claim.
“I believe it would be of real value if insurers can say to customers that they have made a pledge to treat them fairly,” said Kirwan. “It would give customers more confidence at the point of sale and would allow them to go back to the insurer if they need to and say ‘here’s your pledge and I expect you to live up to it’.”
The ABI will seek the involvement of the Financial Services Authority and the Financial Ombudsman Service in drawing up the charter, which Kirwan believes will put more weight behind it.
“We will be exploring what the customer needs to hear in order to have confidence in insurers,” he said. “We want something that is focused and relevant – if it is too watered down it won’t be worth it. Customers want to see statements like ‘we will’, not ifs and buts.”
Colin Last, director at Tamar IFA Ltd, believes the charter would be a good idea for critical illness policies in particular, which have suffered from a lot of negative press.
“Customers often read in the press that companies don’t pay out on claims and they think there is no point taking out a policy,” he said. “Some customers also think that intermediaries say claims are paid in order to get a sale, whereas if it is written like a key facts guide it would carry more weight. It would be like a promissory note.”
Tags: ppi compensation, ppi claim