The Financial Ombudsman (“FOS”) was set up in 2000 by Parliament as an independent public body to resolve complaints between financial businesses and their customers.
Their stated aims are to “resolve individual disputes between consumers and business – fairly, reasonably, quickly and informally”.
An estimated two million people contacted the FOS with problems last year.
Up until 1 April 2019 the FOS compensation limit was £150,000.
From 1 April 2019 that limit significantly increased to £350,000 for complaints about acts or omissions taking place after 1 April 2019.
For complaints about acts or omissions taking place prior to 1 April 2019, but referred after that date the limit also increases to £160,000.
Both limits will rise in line with the Consumer Price Index (“CPI”) each year, from April 2020.
In addition the qualifying criteria for companies to access to the FOS’ services as an ‘eligible complainant’, have changed to widen the reach to the following:
Small and Medium Enterprises with an annual turnover of less than £6.5 million (previously £2 million); and
Fewer than 50 employees (previously the limit was 10);
A balance sheet under £5 million.
How can Plexus Help?
The increase in scope will undoubtedly lead to delays and further backlogs. Evidence given to the Treasury select committee in January 2019 suggested there were around 30,000 complaints waiting for allocation and a backlog of 8,000 claims with investigation complete but waiting for a decision to be made.
The Property Risks & Coverage (PRC) and Professional Indemnity & Financial Risks (Profin) teams at Plexus are well versed in advising insurers on disputes referred to the FOS and handling FOS referrals.
In addition we have a trained, Accredited Mediator within the team who can provide an impartial mediation service to Insurers and their policyholders as an alternative solution to waiting for a decision from the FOS.
If you would like to know more about this matter, please speak to your contacts at Plexus Law:
Louise Wright, Partner (PRC)
T: 0113 222 9063 | M: 07867 459 491 | E: firstname.lastname@example.org
Victoria Jordan, Partner (PRC)
T: 0207 469 6252 | M: 07590 486 147 | E: email@example.com
Gordon Walker, Partner (Profin)
T: 0113 2238 331 | M: 07557 036 901 | E: firstname.lastname@example.org
Whilst we take care to ensure that the material in this Briefing Note is correct, it is made available for information only, and no representation is given as to its quality, accuracy, fitness for purpose, or usefulness. In particular, the contents of this Briefing Note do not give specific legal advice, should not be relied on as doing so, are not a substitute for specific advice relevant to particular circumstances. Plexus Law accepts no responsibility for any loss which may arise from reliance on information or materials published in this Briefing Note.