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					UK Financial Ombudsman Service
     independent external review
David Thomas
corporateby Lord Hunt of Wirral
         director and principal ombudsman




                                            1
UK Insurance Ombudsman
 established by insurers voluntarily in 1981
 in partnership with consumer bodies
 alternative to civil courts
 but redress beyond the law
 binding on provider, but not consumer


                                               2
characteristics
 complain to provider first
 free to consumer
 flexible and informal processes
 mediation or investigation and decision
 specialist knowledge
 encouraging complaint resolution / prevention

                                             3
other financial ombudsmen followed

 banks
 building societies (mutual mortgage banks)
 investment product providers
 investment intermediaries


                                              4
Financial Services and Markets Act 2000

        Financial Services Authority
        (the regulator)



              Financial Ombudsman Service
              (resolves on unresolved disputes)



                     Financial Services
                     Compensation Scheme


                                                  5
providers covered
services provided in or from the UK by all:
  banks and building societies
  other lenders (mortgages and consumer credit)
  mortgage and loan intermediaries
  credit unions and electronic money institutions
  insurers and insurance intermediaries
  investment providers and intermediaries
  credit reference agencies and debt collectors
                                                    6
complainants covered


 individual
 business     (< €1.5 million turnover)
 from UK and world-wide



                                          7
any complaint
not resolved by   prompt written    keep consumer
close of the      acknowledgement   informed
following         to consumer
business day




                                    within 8 weeks:
what the rules require              ‘final response’
                                    with details of
providers to do                     ombudsman


                                                       8
If complainant has not complained to provider

we:
 send the provider details of the complaint, and
 remind it to issue a final response within 8 weeks
 send the complainant a pre-populated complaint
 form, to complete and return it if the complaint is
 not resolved within 8 weeks


                                                       9
customer contact division

        phone                      written
        enquiries                  enquiries
        (341, 455)                 (286,359)




               total                               enquiries
               enquiries          to casework      converted to
               (627,814)                           cases
                                                   (94,392)


figures are for ALL financial products in year ended 31 March 2007

                                                                     10
    case                 casework division


early termination
by adjudicator




                    non-binding    final
 mediation by                      decision by
                    decision by
 adjudicator                       ombudsman
                    adjudicator



                                                 11
early termination by adjudicator

for example:
   no reasonable prospect of success
   fair settlement on offer
   more suitable for court
   legitimate commercial judgment
[can ask for review by ombudsman]


                                       12
mediation by adjudicator
 evaluative mediation
 by agreement




                           13
non-binding decision by adjudicator
 (paper) investigation
 legal power to compel evidence
 non-binding decision
 both sides can accept
 either side can ask for the case to
 go to an ombudsman (<10% do)

                                       14
review by ombudsman (internal appeal)

 request by either side
 additional evidence/arguments
 possible hearing (rare)
 final decision
 if consumer accepts, both sides bound
 otherwise, neither is bound


                                         15
basis of decision

 law requires us to decide what is
 ‘fair and reasonable in the circumstances’
 rules require us to take account of:
 - relevant law
 - regulators’ rules and guidance
 - industry codes
 - good industry practice

                                              16
redress

we can require the provider to:
  pay compensation up to €150,000 *
  pay interest
  pay costs (rare)
* we can make a non-binding recommendation for more



                                                      17
alternatively, or additionally

we can direct the provider to take
appropriate action in relation to the
complainant – for example:
  put something right
  reconsider an application or claim
  apologise


                                        18
insurance cases: year to 31 March 2007

 4,230 motor               680 critical illness
 3,734 life                520 commercial
 1,951 buildings           445 legal expenses
 1,832 loan protection     388 medical
 1,670 travel              273 pets
 1,238 contents            202 breakdown
   891 income protection   177 personal accident
   713 extended warranty    77 caravan
                                                   19
www.financial-ombudsman.org.uk
  independent external review
       by Lord Hunt of Wirral
www.financial-ombudsman.org.uk/accessibility/polish/
twoje_zazalenie_a_rzecznik_praw_obywatelskich.htm




                                                       20

				
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