Motor insurance complaints continue to rise despite FOS warning

Complaints about car and motorcycle insurance increased to a new five-year high between July and September 2023, new figures by the Financial Ombudsman Service (FOS) have revealed.

Published yesterday (14 December 2023), the data showed that 4,036 complaints were made to the FOS in the second quarter of the financial year, up from 3,869 in the first quarter.

The regulator noted that the spike in vehicle insurance cases was being caused by valuation disputes, customer service issues and delays in payouts.

The rise came despite the FOS slamming insurers in September for the increases in complaints between April and June.

“Many people depend on their cars, so it’s concerning to see such a significant rise in vehicle-related complaints,” Abby Thomas, chief executive and chief ombudsman of the FOS, said.

“What’s clear is that whatever the perceived issue, firms need to ensure they are treating customers with transparency and fairness.”

Uphold rate

Meanwhile, the FOS also revealed that car and motorcycle insurance was among the top five most complained about products during the second quarter.

And some 35% of vehicle insurance cases were upheld between July and September, up from 27% during the same period last year.

James Dipple-Johnstone, deputy chief ombudsman at the FOS, said that “the vast majority of motor finance complaints are now brought by professional representatives”.

“We’re seeing a mix of both good and bad practice, but with an uphold rate of just eight percent, it’s clear some representatives could do more to learn from our established approach about which cases are likely to have merit and advise their clients accordingly,” he added.

“It’s important to remind consumers also that they do not need to use a professional representative as our service is free, independent and easy to use.”