Public complaints about insurers in decline

It’s getting less ornery out there, if the number of public complaints against insurers is a reliable measuring stick.

The General Insurance OmbudService (GIO) received 4,370 contacts from insurance consumers across the country in 2022, with 174 of them escalated to case status.

That’s the lowest total of consumer contacts GIO’s received about insurance matters since 2018, when the total was 3,972.

Public inquiries and complaints about insurance exploded to 5,195 during the rise of the hard market in 2019, stats published in GIO’s past annual reports indicate. And they remained at elevated levels during the years of the COVID-19 pandemic (5,443 contacts in 2020, and 4,873 contacts in 2021).

GIO is an independent organization created in 2002 to help Canadian consumers resolve disputes or concerns with their home, auto or business insurers. “Our goal is to use our extensive experience and industry-related insight to work towards a fair resolution between individuals and their insurance providers,” GIO stated in a recent media release marking the organization’s 20^th anniversary.

GIO has received 56,000 contacts from Canadian consumers over its 20-year existence, or an average of approximately 2,800 per year.

Most of the contacts are dealt with by providing information to consumers. And, the overwhelming majority of consumer inquiries to GIO involve claims resolution. For example, of the 4,370 contacts GIO received from consumers last year, almost 60% (2,609) of them were claims-related.

This year, GIO provided two ‘case studies’ of the type of claims complaints it received.

One involved an insured driver who had a not-at-fault accident, as noted in GIO’s 2021-22 annual report. The insurer deemed the car repairable, and the consumer used a body shop that was not among the insurer’s preferred vendors. A labour charge rate was applied in accordance with the shop’s fees.

But since the labour rate came from a non-preferred shop, “the insurer took the position that this charge was not approved, which resulted in the consumer owing some additional funds,” as GIO noted.

But GIO’s Consumer Service Officer (CSO) reviewed the consumer’s file and “discovered that the consumer’s supporting documentation included an approval by the insurer to pay the labour charge rate in this case. Once provided with this information, the insurer determined that this information had been overlooked and agreed to pay the outstanding funds owed for the repair.”

In a travel insurance claim, a consumer travelled on a personal trip to Florida, where she was admitted to the hospital for a serious illness. She was released from the hospital one day before her return flight to Canada.

“She was required to provide negative results from a COVID-19 PCR test before her flight home, but the hospital was unable to perform one,” the GIO report notes. “As a result, her test results were not available for 72 hours and she missed her flight. The insurer denied the consumer coverage for the cost of the new return ticket.”

GIO took up the case with the insurer, noting the delay in producing the PCR test was not the fault of the insured. “Upon further review of the file, the insurer agreed to pay the consumer’s claim,” GIO wrote.

Feature image courtesy of istock.com/andresr