New commercial complaints eligibility

We’re updating commercial customers about changes to the definition of eligible complainants.

We’d like to make sure our customers have complete confidence in our products, but life doesn’t always go quite to plan. If something’s wrong, and a customer isn’t happy, we’re keen to make sure we can put things right. We’re also committed to making sure customers can find out easily how to voice any concerns or make a complaint.

• On 1 April 2019, the Financial Conduct Authority is extending its definition for complaints, so that a larger proportion of small businesses may refer eligible grievances for arbitration to the Financial Ombudsman Service

From 1 April, the new wording will redefine the size of micro-enterprises, introduce a new definition for SMES, increase the threshold limits for charities and trustees, and introduce terms of reference for guarantors.

How does this affect you, how does this affect our customers?

For you, our brokers, there’s no change. But we thought you’d like to know about these changes, and have a useful reference point if there’s ever a need to pass this information on.

For your customers, we’ll make a change to the wording that describes our complaints process and we’ll let them know about these changes via a Notice to Policyholders.

These changes affect commercial customers only, as customers with personal lines products won’t be impacted by the new definition. Existing customers will be given details at renewal, while new customers will receive a notice explaining what the changes are.

What are the changes in full? 

From 1 April, the new definition for eligible complainants will be:

• Consumers (natural persons acting for purposes outside of their trade, business or profession);
• Micro-enterprises with an annual turnover or annual balance sheet of less than EUR2 million and fewer than 10 employees (a micro-enterprise is a business engaged in economic activity irrespective of the legal form, including but not limited to, self-employed persons and family businesses, partnerships or associations)
• Small businesses that are not a micro-enterprise as defined above, with an annual turnover of less than £6.5 million and fewer than 50 employees, or an annual balance sheet of less than £5 million 
• Charities with an annual turnover of less than £6.5 million
• Trustees of a trust with a net asset value of less than £5 million
• Guarantors, for whom the complaint arises from matters relevant to their relationship with a business (a guarantor is defined as someone who is not a consumer and who has given a guarantee or security in respect of an obligation or liability of a micro-enterprise or small business, as defined above).

Information for your commercial lines customers 

If any of your customers feel they have a cause for concern, in commercial or personal lines, we’ll do our best to address their queries as quickly and fairly as we can. If customers aren’t satisfied with our final response in such a situation, then they may refer a complaint to the Financial Ombudsman Service (but they must do so within six months of the date of our response).

 

For more details, please refer customers to www.financial-ombudsman.org.uk