Pandemic-related BI case reduces trust in insurers
Source: Middle East Insurance Review | Nov 2020
The Financial Conduct Authority’s (FCA) test case for non-payment of COVID-19 pandemic-related business interruption (BI) claims has weakened trust in the insurance sector, according to a Chartered Insurance Institute (CII) poll.
Two-thirds of insurance professionals surveyed said they feel that the FCA’s case has reduced trust in the sector. The survey was conducted among 142 of the professional body’s members over social media in September.
Its results revealed that 29% of respondents feel the FCA case resulted in the public’s trust in insurance being greatly reduced and 39% thought it somewhat reduced the faith consumers have in policies paying out when needed.
Commenting on the results, CII chief membership officer Keith Richards said consumers continue to value transparency and clarity as integral to trusting services and their providers.
“The poll results show how pragmatic insurance professionals are about the role of trust in their relationships with consumers and how important it is, tied to not just their actions but the actions of everyone involved in the market,” he said.
The CII set out a clear blueprint as to how insurers should respond to the situation, predicated on settling claims outside of the courts where possible since the FCA test case was announced.
The institute is also looking towards improving clarity standards in product governance and looking to the future – supporting a comprehensive look at the role insurance can play in future pandemics and where government liability needs to be introduced.
“We are pleased to see many of these actions have been followed and we hope that the recent judgement will be a catalyst for the sector to take further action, where it is needed,” Mr Richards said. M