Some insurers have ‘failed’ to meet regulatory requirements when handling coronavirus-related business interruption claims, while others have failed to meet them consistently, the financial watchdog has warned. from the United Kingdom.
The Financial Conduct Authority said on Tuesday that he would use “all regulatory tools” to rectify the “significant issues” he encountered while analyzing the companies’ handling of such claims.
Business interruption claims have proven to be an area of ​​significant controversy for insurers since the coronavirus lockdowns began in March 2020.
Many insurers disputed the extent of the losses claimed by the companies, leading to legal action seeking to resolve the extent of the liabilities.
The FCA filed a class action seeking clarification of the meaning of certain insurance wordings, which resulted in a Supreme Court ruling in January last year seeking to expedite decisions on thousands of small claims. and medium enterprises. Other cases remain to be processed.
Tuesday’s statement highlighted some instances where insurers had handled cases well, including making interim payments based on incomplete information and struggling to release statements to help policyholders.
However, the authority said some companies lacked clear information to allow senior managers to identify the causes of late payments.
Claims handlers sometimes did not have easy access to policy wording. The authority also criticized the communication of certain companies with the insured.
“We expect all regulated businesses to conduct their business in accordance with our rules and regulatory requirements,” the authority said. “Our work on BI complaint handling shows that some companies have not met these requirements or have not met these requirements consistently.”
The authority added that it was encouraging companies to review their processes.