Don’t be bullied by your insurance company

by Henri May on 09 November 2011  |  14 comments
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If your insurer is trying to put you off from making a valid insurance claim, use the law to fight back.

Fresh from a holiday, I have a habit of cornering people with glowing tales of my travels. Although I’d love to whip out the photo album right now, the story below is of a more subdued nature.

Halfway through my trip, I was suddenly taken unwell and ended up in a foreign hospital with a rather shocking bill. Fairly confident the cost would be covered by my travel insurance, I made the necessary calls and forgot about it until touching back down in the UK.

Not so straightforward

My ‘straightforward’ claim then morphed into something more complex requiring several phone calls, emails, a shouted international call on Skype (though at 1.6p a minute, it’s worth a vocal work out) and digging out numerous past records. That was before even looking at the claim form. Now I’m waiting with baited breath for the outcome.

Despite being a palaver, it’s normal to have to gather proof of, and relating to, your claim. But what if the request for documents seems unreasonable? Where is the line drawn?

If your insurance company is giving you the silent treatment, or you think it’s creating extra paperwork for you, speak up. A relatively recent piece of law exists to protect you.

The nitty gritty

Your law in shining armour is found in the Consumer Protection from Unfair Trading Regulations 2008. They encourage the fair treatment of consumers by prohibiting certain practices.

If your insurer acts in a way which dissuades you from making a claim, it is illegal. This is one of 31 no-no’s on a black list and is considered to be automatically unfair (no further legal tests are applied).

The legislation states it is an unfair practice if you are asked to produce documents ‘which could not reasonably be considered relevant as to whether the claim was valid’. Use your common sense with this one and don’t blindly accept what’s being asked of you without enquiring. If you don’t think a document is relevant, it probably isn’t.

The other example is if your insurance company ‘fails systematically to respond to pertinent correspondence’. So be wary if you fail to get a response you need.

If you’re tempted to chase your claim up, and you’re given a costly 0845 number, remember to check for a cheaper alternative before getting in touch.

Action stations

So what can you do if you think you may be a victim to this banned practice?

The regulations don’t give you what’s called a ‘right of action’ against your insurance company. However, the Office of Fair Trading has a duty to enforce the law on your behalf.

It’s always worth pointing out to your insurance company that its actions could constitute a criminal offence and that might do the trick.

If not, contact Consumer Direct  or Consumer Focus for advice and to check that your complaint is valid. You then need to file a complaint with your local Trading Standards office, giving details of the company, the practice and how it impacted on you.

A warning letter from an enforcement authority may have the desired effect but more formal options, such as criminal investigation and prosecution, are available for more serious cases.

Not worth the hassle

Of course, you may decide it pays not to make a claim, regardless of the behaviour of your insurance company.

It’s still wise to be aware of the regulations as they cover a multitude of dodgy dealings including misleading and aggressive practices. If you want to know more about them, check out this quiz.

Have you ever had any difficulties making a claim on your insurance? Why not share your experiences with your fellow lovemoney.com readers via the comment box below?

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