- 3 min
Seven key points in the Insurance Ombudsman’s 2019 Report
The Insurance Ombudsman has published its Activity Report for 2019, which provides an opportunity to take an in-depth look at developments in the sector, and to learn some lessons from them.
2019: what the numbers say
● 15,000: this is the number of referrals received by the Ombudsman. Despite a slight decline at the end of 2019 and a timid rise during the course of 2020, this volume remains stable overall. It underlines the interest of professionals and insurance companies in this type of solution.
● 95%: this is the proportion of referrals submitted on the initiative of policyholders, with the remainder originating from lawyers or third parties. With regard to the latter, the Ombudsman notes the high quality and sound argumentation of applications from consumer associations.
● 33%: only a third of all referrals are admissible, with the remainder being premature.
● 25%: in a quarter of all cases, the mediator finds in favour of the policyholder.
The Ombudsman observes that there is a genuine need for mediation in our society, and that insurance is no exception. It stresses the importance of education by market players in order to reduce the number of premature or inappropriate demands, and to ensure the effectiveness of this recourse.
Information and education
This new edition of the Ombudsman’s report is presented in the form of a collection of studies of the most frequently encountered cases handled by its teams. In parallel with this report, it now publishes a new case study on its website every two weeks, which acts as a useful database for insurance professionals seeking to monitor the Ombudsman's positions and actions.
Shifting the focus of the discourse back to the essentials
The legislation requires professionals to clearly highlight the key points of policies, which are often numerous. However, insurers are responsible for verifying that policyholders have clearly understood the extent of their coverage. The trend in the industry is towards the use of simpler and more expressive language outside of policies.
During the life of policies, brokers, general agents and insurers have a duty to advise. Policyholders are responsible for properly analysing their new needs, of course, but professionals must maintain regular contact with them in order to offer their expertise, if necessary. They must ensure that the policies taken out are always in line with the policyholder's situation, assets or plans. These ongoing exchanges help prevent the occurrence of discrepancies between policyholders’ expectations and their contractual position. This approach enables potential conflicts to be anticipated.
...and keeping record of it
In recent years, the regulator has regularly drawn attention to the information obligations incumbent on insurers. They must also keep records of all items they pass on to policyholders. This commitment applies at the time of subscription but also during the life of a policy. In the event of disputes, the Ombudsman will pay particular attention to the quality of the information provided and its proper presentation.
Supporting the transition to “soft“ mobility solutions
Electric scooters, hoverboards, gyropods, etc. are examples of land-based motor vehicles under the Insurance Code and, since 23 October 2019, they must be insured. This means that users must now be informed about adequate protection solutions. Indeed, they are generally not covered by comprehensive home or automotive insurance policies.
Changing the terms of a group insurance policy
Individual policyholders do not have the same rights under group insurance policies: their policies can be modified without their prior consent. This point causes many disputes and calls for the provision of clearer information.
Withdrawing capital from pension insurance policies
The recent pension savings reform could help prevent a number of frustrations in the future, notably due to limited opportunities to withdraw capital. Watch this space...