Insurance & Financial Services Ombudsman (IFSO) Karen Stevens saw a drop in the number of complaint enquiries made to her office in the year to 30 June 2022.
The organisation’s 2022 annual report shows there were 2,847 complaint enquiries from consumers about financial service providers, including nine about financial advisers.
Of all the complaints, 285 resulted in formal investigations that led to more than $1.2 million being paid to consumers. In the 2020-21 year, there were 3,626 enquiries, of which 334 were taken up by the ombudsman.
Stevens says it’s possible to link the reduction in enquiries with the increase in financial markets legislation and the sector’s focus on the customer.
“It’s pleasing to see the financial services industry is working hard to resolve issues with customers before they escalate to complaints,” she says. “We see a high level of compliance and goodwill from the sector.”
The IFSO scheme has also seen complaints in the life insurance sector fall over the last four years.
Stevens says a greater scrutiny on culture and conduct by the FMA, and an improvement in how insurers deal with customer dissatisfaction, might explain the drop.
“With the new CoFI legislation and a focus on treating customers fairly and putting them at the centre of an insurer’s business, it is likely that the drop in complaints will be a continuing trend,” she says.
The top five complaint enquiries related to:
- Motor vehicles
- House
- Credit Contracts
- Life
- Contents
The top five complaint issues were:
- Scope of cover
- Policy exclusions
- Mis selling/misleading information/misrepresentation
- Non-disclosure
- Prima facie claim
Stevens says underinsured New Zealanders do not understand the benefits of insuring their life or health and “…increasingly believe that ACC will protect them if necessary”.
Since IFSO started 27 years ago it has dealt with 72,928 complaint enquiries and investigated 7,625 complaints.
See our 2021 report: Insurance Ombudsman sees 25% Increase in Complaints