An Irish insurance company has been fined nearly half a million euros by regulators, over their supposed failures regarding consumer protection failures. The Central Bank have reprimanded FBD Insurance, leading to them a 490,000 euro fine. The regulator found that the company was failing to ensure that steps were taken to comply with strict consumer rules for its intern operations and outsourced business. FBD has owned up to the errors and thankfully no customers will end up out of pocket as a result.
The investigation found that the insurance company, failed to give customers a point of contact or keep them up-to-date on the status of complaints. FBS has been in the market for forty years and currently look after around 500,00 thousand different clients. The Central Bank stated that FBD were not informing customers they were allowed to refer their complaints to the Financial Ombudsman or even that they could switch their verbal complaint to a written one. Alongside this, the company were also failing to keep their records up-to-date or accurate. Customers were never advised by the insurance company that loss adjustors, who had been appointed by FBD, were acting in the company’s interests.
The regulator have stated that the company are now attempting to rectify the situation, while making it known that penalty reflects the seriousness of the consumer protection breach. It is unacceptable for firms to outsource regulated activity without appropriate oversight. There have been thirteen settlements secured by the regulator following breaches of the consumer protections code and director has noted that inadequate systems and controls in a financial institution are an unacceptable risk.
Central Bank want regulated entities and their management to be aware that they will take any systems or control failings will be vigorously investigated, with a swift follow up by them. They will not hesitate to treat breaches as the serious issues they are. They will issue penalties in an attempt to highlight to others that they will not take situations such as this one lightly.
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