The UK insurance industry regulator has found poor claims experience and rife underinsurance among SMEs, in a report that some fear would mirror the Australian experience.
Last month, the Financial Conduct Authority released the results of an investigation into the handling of insurance claims for small and medium businesses.
It found most SMEs reported a poor claims experience, with feelings of unfair treatment.
In 20% of the claims examined, it took at least three weeks for losses to be assessed.
FCA also found, in the majority of cases, it was left up to the claimant to chase the insurer for updates on the claim.
“In some cases, SMEs were seeking more than a mere update on progress and wanted advice and guidance,” the report found.
“In one of the case studies, the files included at least eight explicit requests for advice and guidance. In each of these cases, little or no response was received.”
The investigation also found that close to two-thirds of claimants were under-insured, raising possible professional indemnity issues for their brokers.
LMI Group Founder Professor Allan Manning says he suspects repeating the investigation here would produce similar findings.
“The findings are disappointing to say the least for the insuring public,” he says.
“It does however create a call to action for brokers and some lessons learned to share with your clients.”
To view the full report, click here.