The number of complaints to the Financial Ombudsman Service (FOS) increased by one third in the third quarter
The number of complaints to the FOS in the third quarter of 2020 increased by 32% compared to the same period in 2019, which amounted to 48,932, said Chief Financial Ombudsman Yuri Voronin.
In the third quarter of 2019 the number of complaints to the FOS was 37,062.
41,756 complaints (86.4%) out of the total number deal with motor liability insurance, and 6560 complaints (13.6%) with other kinds of insurance. Complaints were received against 109 insurance companies in the third quarter of 2020.
“The sharp increase in complaints is primarily due to the low base effect, as the third quarter of last year was the first full starting reporting period. After one year, the level of penetration of the institution of out-of-court dispute resolution into society increased substantially. We see that consumers who have successfully settled their Motor Third Party Liability disputes thanks to the new institution are coming to us again, but already in relation to other types of insurance, which have been under the competence of the Financial Ombudsman Service since November 28, 2019. The emergence of these types of disputes in the structure of complaints has also affected the dynamics,” Yuri Voronin says.
In general, the third quarter of 2020 is characterized by a significant increase in the number of complaints after the reduced number of them in the second quarter against the background of Coronavirus pandemic restrictions. Some disputes that arose between consumers and insurance companies in April and June were submitted to the Financial Ombudsman Service in the third quarter.
Insurance disputes under MTPL insurance contracts continue to be leading in the third quarter of 2020. During the reporting period, the Financial Ombudsman Service received 39,976 complaints related to MTPL insurance contracts, which is 12% more than in the third quarter of 2019, when the number of complaints under MTPL insurance contracts was 35,624. The largest number of complaints concerned disputes related to disagreement by the claimants with the amount of insurance payment.
Life insurance ranks second in the number of complaints to the FOS (3012, or 6.2%). Of these, the main number (2055, or 4.3%) was over disputes related to the refund of the insurance premium upon termination of the insurance contract. The third place in the number of complaints are disputes related to accident and illness insurance contracts (2243, or 4.6%).
Consumers of financial services have also submitted 186 complaints to microfinance organisations, disputes with which have been handled by the Financial Ombudsman Service since January 1, 2020. In the structure of these complaints, the majority of those types of disputes do not fall within the competence of the FOS (72, or 38.7%). The same situation was observed when the Financial Ombudsman Service started working with insurance disputes: citizens often applied for disputes that do not fall under the FOS competence. “Over time, however, as insurance service consumers were informed about the out-of-court procedure for dispute resolution, the situation improved as the FOS began to work. We hope that the MFIs will also spread information to customers about the out-of-court procedure for dispute resolution through the FOS, especially so as it is provided by law,” continues Yuri Voronin.
The average amount of complaints from claimants in the third quarter of 2020 was 209,413 rubles for insurance disputes, and 22,656 rubles for disputes with microfinance organizations.
A total of 29,242 decisions were taken in the third quarter of 2020, based on the results of the complaints consideration by the Financial Ombudsmen, which is 4.4 times as much as that in the same period of 2019 (6636 decisions).