Tackling Bad Practise in the Insurance Industry
We all buy insurance policies in the hope that whatever we insure does not come to pass. We all hope that we won’t have an accident, die unexpectedly, have complications during our holiday or be burgled and that our insurance policy will never be called upon. However, if the worst does happen, we hope and expect that our claim will be dealt with in a professional manner and as a matter of urgency, understanding that at the point at which we contact the insurer, something traumatic has happened and we are in a vulnerable state. Sometimes our expectations are met. I recently needed to claim off my car insurance after someone drove into the front wing of my vehicle, and the efficiency of the insurer, LV, meant everything was sorted with a minimum of disruption and trauma.
In April, in my former capacity as her Member of Parliament, I highlighted the case of Claire Massey in Prime Minister’s Questions, using parliamentary privilege to name and shame the companies involved. Claire Massey and one of her two children almost lost their lives in a fire at her home in February 2023. Since then, Claire had experienced bullying by aggressive claims handlers and negligent and unprofessional conduct, including voiding her policy and withdrawing alternative accommodation. She raised institutional failings with the Financial Conduct Authority and with the Financial Ombudsman. Sadly, the mechanisms we currently have in place for consumer protection are simply not effective. Claire’s claim was upheld by the Financial Ombudsman, but the delaying tactics of the insurers have meant that, 17 months on from the fire, Claire’s property has become more uninhabitable (and more expensive to repair) as bad weather penetrates the property.
This is a tragic story which is sadly all too common. It shines a light on the imbalance of power between the wronged individual and a large corporate entity, where the latter chooses to ‘lawyer-up’ rather than pay up. Coincidentally, sitting in the House of Commons Gallery at the same time as Claire were a group of sub postmasters who had been affected by the Horizon scandal. It reminded me that one of the key features of that shocking saga was how the Post Office bullied individual postmasters, telling them it was only their accounts that didn’t balance, so they were isolated in the discussions by an organisation which used bullying and intimidatory tactics throughout. Without the bravery of Sir Alan Bates and those who joined his early group of subpostmasters to stand up to the bullying, what has been described as the biggest miscarriage of justice in British history may have never come to light. A vital piece of the jigsaw was the whistleblower from Fujitsu who offered the explanation as to how this could have happened and that the Post Office knew this.
I had a meeting with the relevant minister in April to look at how we can better protect consumers against bad practices in the insurance industry. Little progress has been made and so with a change of government I hope this will be prioritised. However, we must now go further in addressing wrongdoing in every sector. The time is right to set up an Office of the Whistleblower, so that brave individuals who come forward to reveal bad practice in their workplace are given the assurance that there will be a proper independent assessment of the issues they raise. This will hopefully see an end to stories such as those in the NHS, where whistleblowers have sacked for raising concerns about patient safety. We must root out and challenge bad practice everywhere, and make it easier to speak out without fear.
