Statistics provided by the Financial Ombudsman Service in its annual report for the year 2011-12 has shown that the organization received more than 264,000 new cases in the year out of which more than 157,000 cases were related to payment protection insurance policies. 60% of the total number of new cases received by the FOS during the year was related to missold PPI policies alone. The large number of complaints also resulted in more than 1.2 million front-line complaints received by the FOS. This means that the organization received and handled more than 5000 complaints on a daily basis.
Banks and financial institutions are putting in a lot of hard work to process claims speedily. The number of individuals filing complaints against banks is steadily increasing and this is the primary reason why banks are pushing on efficient processing of mis-sold PPI claims. Despite the efforts, customers are complaining about the quality of service and the delay in response by banks. This is creating a vicious cycle were more complaints create more complications and compel customers to file even more complaints. However, data provided by the FOS provides a bit of cheer as it shows that complaints against banks have come down by 9%.
Data related to personal finance dispute provided by the FOS has indicated that claims management companies are involved in 69% of all the complaints received by banks and financial institutions. The latter has blamed involvement of new claims companies for delays in processing of claims. Industry commentators and associations are claiming that these companies adopt a very casual and relaxed approach when filing claims and this results in extra work for the financial institution. Banks have also complained that these companies often file frivolous claims without bothering to verify the details. According to banks, they have received more than 5500 false and frivolous complaints in the year, more than twice the number of such complaints received in the previous year. One can only wait for the FOS to release more data to determine the impact of such claims.