Rise in complaints to the Insurance & Financial Services Ombudsman Scheme

7 April 2016

Canterbury earthquake insurance issues are one reason for the steep rise in complaints to the Insurance & Financial Services Ombudsman over the past 4 months.

“From December 2015 to March 2016, we received 985 complaint enquiries, and we accepted 100 complaints for investigation,” says Insurance & Financial Services Ombudsman Karen Stevens. “During the same period last year, we dealt with 895 complaint enquiries and accepted 60 complaints.”

“We’re pleased to hear from more consumers who have issues and questions about insurance or financial services. Our service is free and independent, and we are here to help.”

17 of the 100 complaints during this period related to the Canterbury earthquakes. This time last year, we had 3 Canterbury earthquake complaints. “Common Canterbury issues we are seeing include cash settlement issues; delays; driveways, fences and retaining walls; repair or rebuild costs; and issues with the scope of works.”

Together with being the most destructive catastrophe in New Zealand history, Karen says the earthquakes have had an unprecedented impact on the insurance industry and its customers. “Our scheme has dealt with 1,700 Canterbury earthquake complaint enquiries and 175 complaints since 2010. We believe there are still more consumers who could need assistance to resolve their complaints. They can contact us any time on 0800 888 202.”

“Effective dispute resolution is about bringing two parties together, listening to both sides and considering the facts as an independent third party. We are doing our best to help resolve Canterbury complaints in this way, and we continue to adapt our approach to deal with the increased level of complexity of the complaints.”

Karen says Southern Response agreed to extend the IFSO Scheme’s jurisdiction for their customers so we can get involved where the amount in dispute exceeds $200,000. “This has given us more flexibility to investigate complaints where more money is at stake. We want to get involved as early as possible to be able to facilitate a greater number of agreed outcomes.”

35% of Canterbury earthquake complaints are settled, compared with a 22% settlement rate for complaints overall. “Settlement means the customer and their insurer have agreed to the outcome. It demonstrates a willingness from both parties to work through complex issues to finalise the claim.”

Together with Canterbury earthquakes, the IFSO Scheme has also seen a slight rise in complaints relating to credit contracts from the same four-month period last year (from 1 to 4 complaints) and a rise in complaints about financial advisers (from 0 to 4 complaints).

Case study summaries of all complaints are available from the IFSO Scheme website.

See: www.ifso.nz

Canterbury residents can contact the Canterbury Residential Advisory Service: https://advisory.org.nz/