By Huw Jones
LONDON (Reuters) -Britain’s Financial Conduct Authority (FCA) will crack down on home and car insurers over failure to improve their treatment of struggling customers, it said on Monday.
The FCA said a review of the sector showed some good practices but that insurers were taking a long time to deal with complaints and people that were not given appropriate settlements.
“The regulator discovered instances of motor insurance customers being offered a price lower than their car’s fair market value after it had been written off, which is against FCA rules,” the watchdog said in a statement.
“We are taking action against those firms who may have broken our rules,” the FCA said without elaborating on specific sanctions or companies.
The Association of British Insurers said the FCA review makes clear that insurers are supporting customers in challenging times.
“On motor insurance alone in the first quarter of the year, insurers paid put 2.4 billion pounds, the highest quarterly payout since our records began in 2013,” an ABI spokesperson said.
The FCA said it has told individual companies to address poor practice and where necessary provide redress.
“All firms are aware that we have a full range of regulatory tools at our disposal if necessary remedial action is not undertaken,” it added.
The FCA has powers to fine companies, ban individuals working for them and also to intensify supervision.
“Timely and fair claims handling is especially vital during the cost of living squeeze,” said Sheldon Mills, the FCA’s executive director for consumers and competition.
The watchdog also issued new guidance to insurers on supporting struggling customers.
Under the tougher consumer duty rules coming into force across the financial sector at the end of July, companies will need to identify what data they are using to assess that customers are receiving good outcomes, the FCA said.
(Reporting by Huw JonesEditing by David Goodman)
