This is a record number of complaints and more than R116m was returned to consumers in 2014. "There's no doubt that consumers are under economic stress and in this type of environment file more complaints against insurers," said Jooste.
The highest numbers of complaints were related to motor insurance (46,9%), houseowner's policies (20,9%), householder's cover (8,2%), and commercial insurance (6,6%). However, the number of complaints received by the office per 1,000 claims received by insurers, had remained a constant three complaints for every 1,000 claims submitted to insurers during 2014.
Overturn ratio
Furthermore, complaints resolved with some additional benefit to the consumer reduced to 31% of total complaints, showing a continuing decline over the past few years. In relation to the decline in what is known as the overturn ratio, it was interesting to note that the ombudsman for long-term insurance reported a similar trend.
Initiatives such as insurers implementing Treating Customers Fairly principles and the publication of insurer statistics identifying insurers who attract a disproportionate number of complaints probably also had a positive impact on the way insurers deal with complaints from their customers. Despite the increase in the number of complaints, the average turnaround time - the period taken to resolve a dispute was reduced to 89 days - a pleasing declining trend. Complaints unresolved after six months totalled only 54 at year end.
An appeal mechanism, which became effective in 2013, to enable insurers and consumers dissatisfied with a final ruling made by the ombudsman to seek redress from an appeal tribunal, had not been used at all. "The appeal mechanism has been widely publicised and the lack of use of the facility hopefully reflects a high level of acceptance of rulings made by the office," said Jooste.
He added that the ombudsman had worked with other ombud schemes in the financial sector to comment on the second draft of the Financial Sector Regulation Bill, which was published in December 2014. The bill is likely to be placed before parliament during 2015 and contains important amendments to the way voluntary Ombud Schemes will operate in future. This includes additional oversight by the regulatory authority, but Jooste said the legislation would not affect the independence of the ombudsman.
During 2014, the terms of reference of the short-term insurance ombudsman were changed, with jurisdiction to deal immediately with a complaint rather than enquire whether the complainant had tried unsuccessfully to resolve a dispute through he insurer first.
