Changes to Complaint Handing Rules

The FSA has confirmed new complaints handling rules as part of a package of measures to drive up standards within the Financial Services & Insurance Industry.

This includes the abolition of the "two-stage" complaints handling rule to make sure firms resolve complaints fairly and do not dismiss them the first time, requiring persistence from the customer to pursue the complaint.

This means that Insurance Brokers / Companies will have only one opportunity to investigate any complaint and respond to the customer with their final decision.

If the customer is not happy with the Insurance Brokers / Companies final decision they can now refer the complaint straight to the Financial Ombudsman Service rather than contacting the Broker / Company again to see if they are willing to change their decision.

Financial Ombudsman Service (FOS)

The FOS is an independent and impartial service set up by Parliament as a result of the Financial Services and Markets Act 2000 to help settle disputes between consumers and UK based businesses providing financial services such as banks, building societies, insurance companies, investment firms, financial advisers and finance companies.

Their role is to sort out individual complaints that consumers and financial businesses haven't been able to resolve themselves and can look at complaints about a wide range of financial matters from insurance and mortgages to savings and credit.

As the FOS are independent it means that when they decide a complaint, they look carefully at both sides of the story and weigh up all the facts.

If they decide a business has treated the consumer fairly, they will explain why. On the other hand if they conclude that the business has acted wrongly – and the consumer has lost out as a result – they can order the business to put things right.

The ombudsman's decision, if accepted by the complainant is binding both on them and on the business.

A complainant has to fulfil certain criteria to be eligible to use the Financial Ombudsman Service. They must be either be

· a Private Individuals, or

· a Businesses with a turnover of less than 2m Euros and who has less than 10 employees.

The FOS website is