The Financial Conduct Authority has fined insurance intermediary Policy Administration Services Limited over £2.8 million for poor complaints handling between June 2009 and September 2011. PAS administered mobile phone insurance policies sold by Phones 4u, which meant it handled claims, complaints and other customer relations.
As well as noting PAS’s failure to record complaints, it also found that complaints were not investigated fully and that complaints about mis-selling were often rejected on the grounds that the customer had signed a Direct Debit form.
Since the investigation, PAS has had its complaints processes independently reviewed. It’s also paid compensation to 1,438 customers.
Tracey McDermott, the FCA’s director of enforcement and financial crime, said “In any business things can go wrong. Proper complaints handling is essential to ensure customers are treated fairly. PAS had wide ranging failures across its complaints handling processes - it failed to investigate complaints properly or to keep accurate records. This is simply not good enough - it does not meet our requirements and does not meet the needs of customers.”
Last week the FCA published a review into mobile phone insurance, warning that companies treating their customers unfairly could face enforcement action.