Complaints data for short-term insurers

This link will open the complaints data from the Ombudsman for Short-term Insurance’s 2021 annual report. The insurers are sorted by number of complaints per thousand claims (column 5).

As the Osti points out, no adverse conclusions should be drawn against an insurer based purely on the number of complaints against it received by the Osti.

Larger insurers issue proportionately more policies that cannot form the basis of a complaint to the Osti because of its jurisdictional limits. Thus, for example, when considering the percentage of complaints received against a large insurer, the large insurer, upon a superficial analysis, appears to attract a relatively low number of complaints.

The statistics in the table focus only on personal lines claims (statistics provided by the FSCA) and personal lines complaints received by the Osti.

The Osti has limited jurisdiction over commercial lines policies and has jurisdiction over personal lines business up to R3.5 million, except for homeowners’ claims, where the jurisdictional limit is R6.5m.

In the Osti’s view, the important statistic is the proportion of personal lines complaints relative to an insurer’s share of the total personal lines claims reported to the FSCA. The clearest indicator of this is column 5, which shows the number of complaints per thousand claims received by an insurer. Where an insurer receives a high number of complaints per thousand claims, this may indicate that the insurer dealt with claims unfairly, the Osti said.

The table shows that the Osti received 8 384 complaints last year, and insurers received 4.3 million claims – in other words, complaints did not even constitute 1% of claims.

On average, there were 1.945 complaints per 1 000 claims received by insurers. Of the 54 insurers listed, 24, or 44%, had a complaint rate higher than this.

Of the 8 384 complaints received, 16% were finalised with some benefit to the insured.

Santam Structured Insurance had the highest complaint rate of 12.6 complaints per 1 000 claims. It received 20 875 claims, and the Osti received 263 complaints about it.

Absa Insurance, which had the highest number of complaints (597), had a complaint rate of 4.2 per 1 000 claims. It received 141 539 claims.

Centriq received the highest number of claims, 417 567 (9.8% of the total), last year. However, it had a below-average complaint rate of 0.424 complaints per 1 000 claims.

Claims and complaints data

Column 1 may show certain insurers as having received no claims during 2021. This may be because the company issues only commercial lines policies or the company is dormant.

A claim can be received by an insurer in year one, and the Osti may receive a complaint in respect of that claim only in year two. Therefore, the number in column 1 may be greater than the number in column 3. The statistics record the numbers received by insurers and the Osti respectively during 2021.

Overturn rate

The overturn rate is an indicator that an insurer’s decision with respect to a complaint was changed in some respect by the Osti, with some additional benefit to the insured.

The overturn rate per insurer excludes complaints resolved “on transfer”.

An insurer is given an opportunity to resolve a complaint directly with the insured where the insured lodged a complaint with Osti before first approaching his or her insurer to resolve the complaint. This process is referred to as “on transfer”.

If the insurer resolves the complaint to the satisfaction of the insured, the insurer’s decision is not recorded as an overturn against the insurer in this table – it is excluded from columns 6 to 9.

The overturn rate should be considered in conjunction with columns 8 and 9, which show the share of matters resolved through conciliation by the parties or by enforcement by the Osti.

The Osti said a high overturn rate may, but not necessarily, indicate that an insurer is not treating its customers as fairly as it should. However, the overturn rate should be treated with considerable caution because a high overturn rate can also indicate that the Osti is receiving a high degree of co-operation from an insurer in resolving a complaint to the satisfaction of the customer.

The Osti takes into account the following circumstances in determining the overturn rate:

  • The Osti overturns the insurer’s decision by way of a recommendation that is accepted or a final ruling.
  • The Osti has mediated a resolution of the dispute, with the insured receiving a benefit that he/she would not have received without the Osti’s involvement.

Also note the following:

  • The statistics for Old Mutual Insure include statistics for Iwyze.
  • The statistics for Momentum Insurance are from 1 January 2021 to 30 June 2021.
  • The statistics for Momentum Insure include Momentum Insurance’s statistics from 1 July 2021 to 31 December 2021.
  • The statistics for Centriq include statistics for Shorprite Insurance Company.

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