FSA to make brokers publish complaints data

The FSA has published proposals that will enable people to see how firms handle complaints – including the number received, the main products and services covered and how quickly they are resolved.

The proposals would see firms publishing their own complaints data every six months and the FSA would publish results from the whole sector twice a year.

Dan Waters, the FSA’s director of retail policy and conduct risk, said: “Transparency is an important regulatory tool. Publishing complaints data will mean that people can learn more about how firms handle complaints and the frequency with which they arise. We also consider that publishing this information will incentivise firms to deal more effectively with complaints and help to raise industry standards in this important area. It is essential that the information is meaningful and genuinely brings benefits by enhancing customers’ experiences of the firms they deal with.”

The FSA is proposing that firms receiving the largest number of complaints publish information on:

• How many complaints they have opened and closed; The percentage closed within eight weeks and the percentage of complaints upheld.

This information will need to be broken down into five product areas: banking, home finance, general insurance and pure protection, life and pensions, and investments. To make it easier for people to understand the data and compare the standard of different firms’ complaints handling, firms will need to provide contextual information such as the number of complaints per 1000 customer accounts.

The proposals are part of a number of steps the FSA is announcing to improve transparency, building on the discussion paper it published in May last year. In addition, the FSA is confirming that it will make greater use of a number of tools already at its disposal, including publishing anonymised results of thematic work and real-life case studies demonstrating where it has taken action against firms for producing poor financial promotions.

The FSA is inviting stakeholders to comment on its proposals relating to the publication of firms’ complaints data – the closing date for responses is 30 October 2009.