Industry calls for scrutiny and regulation of loss assessors

Leading industry figures have called for greater regulation and better standards in the loss assessing sector following customer complaints about their “preying” behaviour.

AXA’s customer experience director, Paul Meehan, has called on the FSA to step up its supervision of the sector.

“If you think that the major tenor the FSA has been banging on about for the last five years has been about treating customers fairly, I would be interested in knowing what type of investigations the FSA is doing in checking whether loss assessors are treating customers fairly.”

He added that the FSA should ensure that consumers are better protected under the Unfair Contract Terms Act after signing a contract with a loss assessor following a traumatic event.

“If someone signs this agreement, they are not given the opportunity to reconsider,” he said.

Market insiders point out that currently no formal qualification or training is necessary for entry into the loss assessing sector.

Lorega chief executive John Sims said: “We have to have stronger regulation that ensures that some Tom, Dick or Harry cannot become a loss assessor overnight. That is just fundamentally wrong.”

Loss assessor Harris Balcombe partner Nick Balcombe pointed out that loss adjusters also remained unregulated by the FSA and that the entire sector, including loss adjusters and claims handlers along with loss assessors, needed to be better regulated.

“I don’t think that only one side should be regulated,” he said. “The whole marketplace needs to be turned upside down and made more consumer-friendly.”

Policyholder Jonathan Chippendale, whose business was flooded in Cockermouth, Cumbria, last year, said that assessors had gone behind a police cordon without permission shortly after the town was flooded in order to convince policyholders to enter into contracts with them.

“I was approached by no less than three loss assessors, all of whom were telling me they would save me a fortune, that the insurance company would no doubt wriggle out of paying what they should, and only with a loss assessor would I be able to maximise my claim and make the most of it,” he said.

He said assessors were demanding up to 15% of the settlement as their fee for taking charge of the claim.

An FSA spokesman said: “Loss assessors acting on behalf of policyholders in the event of a claim are carrying out regulated activity. If there has been an incident of customer detriment, we would encourage people to contact us.”