Broker dispute resolutions get an overhaul

Disputes are set to become a one-step process with the Financial Ombudsman Service (FOS) targeting to overhaul their dispute resolution process by 2015.

FOS is a free alternative to court for customers and small business, dealing with disputes regarding products and services ranging from the finance to insurance sector.

Michael Ridgway, FOS General Resolution Executive General Manager, says the revamp was prompted by an independent review and member surveys, and is aimed at simplifying the dispute process.

“[The review] made some recommendations in two key areas,” he says.

“One was around increasing our pace of efforts to eliminate backlog, but also they made some recommendations around reshaping our dispute process to look at how we can further streamline and take the time we deal with disputes.”

Doing this means reshaping the dispute process components from end to end, Ridgway says.

“What that process will involve is a much shorter dispute investigation time-frame and an earlier involvement of an adjudicator who will provide guidance on the merits of the case,” he says.

“They will be able to issue a decision in a very short period of time if the matter can’t be resolved by an agreement between parties.”

Brokers and insurers can look to the FOS for guidance on examples of different dispute types and information early on in the dispute process.

Ridgway says the changes will have a positive impact on brokers but they must keep up to date with the release of information.

“We think there will be some really good benefits both for our members and consumers. We’re really intending shorter time frames, more of an opportunity for our members to resolve matters in their internal dispute resolution (IDR),” he says.

“If they can resolve matters in the IDR space, the fees involved in that stage are obviously cheaper than they are if matters go further, so there are some good benefits there.

“We plan on engaging in some pretty extensive consultation before we roll out the changes.

“What we plan to do is over May and October is release consultation papers around the process changes. We will get feedback from members and other stakeholders about the changes.

“We will take this into consideration, look at what we may need to amend and provide ongoing communication over the next 12 months of the changes we are proposing.”