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13 December 2022

Motor insurance accounts for more than a third of complaints

New analysis of ombudsman figures reveals complaints about car and motor insurance products have rebounded following a post-coronavirus dip

There were almost 3,000 complaints about car and motorcycle insurance products referred to the Financial Ombudsman Service (FOS) over the third quarter of 2022.

This means that motor insurance continues to be the most complained about product, accounting for more than a third of all complaints reaching the ombudsman.

These latest figures represent a 24% increase on the same period last year as motor insurance complaints volumes rebounded from a dip in FOS referrals after an initial spike in the immediate aftermath of the Covid-19 pandemic.

Buildings insurance was the second most-complained about product line over the three months to the end of September 2022 with more than 1,600 complaints referred to the ombudsman – an increase of 38% compared to 2021.

Travel insurance, meanwhile, experienced the biggest increase in complaints volumes as referrals rose by 71% to almost 750.

This is, however, still much lower than the almost 2,600 travel insurance complaints referred to the ombudsman at the height of the Covid-19 pandemic when the sector was hit by a tsunami of claims that it struggled to deal with.

When it comes to upheld rates, it was home emergency insurance – the fourth most-complained about product – that had the highest number of complaints upheld in favour of the customer out of the five most-complained about business lines.

30% of all complaints about home emergency cover that were referred to the FOS were found in favour of the customer, meaning that insurers were getting their decisions wrong in almost a third of all cases.

The good news, however, is that this upheld rate has fallen over the course of the last four years, dropping from a high of almost 50% at the beginning of 2018.

Indeed, of these five product lines, almost all of them have experienced an improvement in the upheld rate over recent years, with travel insurance reporting the biggest improvements.

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