Complaints Management Part 3

Last week, we discussed the first two specific findings on the effectiveness of complaints handling systems and the need for root cause analysis and corrective action stemming from this.

Today, we share details of findings three and four.

Specific Findings

3. Inclusion of complaints management in the audit scope and/or plan

When no independent review of its complaints management is conducted within an insurer, the insurer will not be in a position to determine objectively and accurately whether its internal processes or policies are consistently and correctly applied.
Although some insurers advised that the complaints process is indeed audited, they were not in a position to provide evidence of related audit findings or of action taken in response to audit findings.

4.  Complaint categorisation

In a number of instances complaints are captured in accordance with their source (i.e. who they are received from), and there is no clear and consistent categorisation of the nature of or reason for the complaint. Where complaints are categorised according to type or reason, the extent to which the categories were aligned to TCF outcomes differed significantly.

Some insurers have too many categories (sometimes in excess of 100) which made it impossible to meaningfully identify any trends and/or conduct a root cause analysis.

In other cases it was found that the categories are not “closed” and that employees could add to the list of already existing categories. This resulted in duplication of categories which again skewed any trend and/or root cause analysis.

Most insurers also have a complaints category named “Other” for complaints that do not naturally fall within any specific complaints category. Although the need for such a category is accepted, instances were observed where this category appeared to have been used indiscriminately, with a large proportion of complaints categorised under “other”, thus undermining the ability to conduct a proper root cause analysis.
The smaller FSP may find it difficult to draw up specific categories, and will probably be led by actual complaints to eventually draw up a practical list.

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