Government to investigate mis-selling of temporary accident cover

The government is investigating mis-selling of insurance policies at six of Britain’s top employment agencies, according to the BBC.

The mis-selling allegations relate to the provision of personal accident cover for temporary workers.

Shadow business secretary Chuka Umunna named six agencies involved in the practice: Blue Arrow, Acorn, Taskmaster, Randstad, Meridian and Staffline.

Umunna said that workers on minimum wage were being pushed into taking out personal accident cover, despite employers often providing this method of protection separately.

“There is even a company – Gee 7 Group – that specialises in putting together these dubious arrangements for agencies,” Umunna said in the Commons.

However, Gee 7 denied being involved in providing temporary accident cover.

The firm’s managing director Jon Pardoe told the BBC: “We have never ever got involved in temporary accident cover. We are aware of companies that do it, but we’ve always disagreed with the principle.”

Business secretary Vince Cable said that if the policies were being mis-sold it would be ‘indefensible’ and ‘unlawful’. He said the companies would be investigated alongside a more broad-based inquiry.

Cable added: “I will commit to ensuring that we have a proper enforcement procedure.”

Director of policy Tom Hadley at the Recruitment & Employment Confederation, which represents recruitment agencies, said employment agencies were not in the wrong offering these policies.

“Let’s be clear, employment agencies are not doing anything wrong by offering workers the opportunity to purchase accident insurance,” he told the BBC. “It’s a product that many other organisations offer to their members, including trade unions.”

He added that temporary accident cover was often a useful way of insuring against accidents that could lead to a period off work.

“Personal accident cover can be appropriate for workers in high risk sectors such as rail and construction and can also cover them for accidents off-site that would prevent them from working,” he said.