Christine Seib says new initiatives will ensure insurers will improve their relationship with policyholders

It's always dangerous, agreeing to things so far in advance. That's how I ended up with an appointment to speak at the FSA's annual insurance sector conference this March. Someone from the regulator saw me speaking at an ABI conference last year and, amazingly, was not deterred.

The topic is "Future design and distribution of retail general insurance products" which, like most things, I have a few thoughts on.

When speaking at the ABI conference, I no doubt ruffled one or two feathers by mentioning that, although insurers were champions at advising the government, businesses, local authorities and policyholders on what they're doing wrong, the insurers don't always like the same medicine themselves.

Asking an insurance company to explain why it made a certain decision, why claims processes work the way they do, or any other query on the sometimes arcane activities undertaken by the sector, and they're often stumped. They frequently struggle to explain their behaviour in an intelligible way.

And if I, who speak to insurers regularly, can't extract a sensible answer, is it any wonder that the workings of the industry is a mystery to most policyholders?

In March, the ABI will update the industry on its new, as yet-unnamed initiative to broaden the good work done by its Raising Standards programme. The new regime will be more prescriptive - insurance company boards will be asked to adopt resolutions setting standards to product design, customer service, marketing and complaint handling.

How well they do in these four areas must be included in their annual report, to be verified by auditors.

Meanwhile, a new ABI board with independent, non-industry members will be set up to monitor how well insurers cope with the new initiative.

At the ABI conference, I quoted some figures from the Financial Ombudsman Service, which said that in the 2004-05 financial year, his office received 11,484 complaints about general insurers and 5,223 about life insurers. And the mailbag at The Times would indicate that the number of general insurers enraging their policyholders has hardly abated.

At the end of March the ABI will release the results of its first comprehensive customer survey, to provide some kind of benchmark on the performance of the life insurers.

If general insurers are so confident that they are purer than the driven snow, surely they wouldn't mind a similarly in-depth survey of their own customers' satisfaction.

This is not an insurer-bashing rant, well, not much of one. I know that most general insurers work hard and get it right 99% of the time. But who is ready to stand up and say that there's no room for improvement? IT

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