Insurance complaints have soared by more than 60 per cent in the past five years – with as many as one in three upheld in favour of the customer by the FOS, according to analysis by Which?

The consumer champion looked at complaints data from the FOS and found that, between April 2018 and March 2019, 25,122 travel, home and car insurance policyholders escalated a complaint – a 61 per cent rise on five years ago, when there were 15,625 cases.

About a third (31 per cent) of these complaints were resolved in favour of the policyholder – meaning the insurer either reconsidered its decision or was obliged to pay out.

Which? found buildings insurance was the worst area for complaints, with a 42 per cent rise compared to last year and more than a third (35 per cent) of complaints found in favour of the customer.

Travel insurance had the second highest rate of upheld complaints, with about a third (34 per cent) of cases found in favour of the customer. More than two in five (41 per cent) complaints about Allianz travel insurance policies were resolved in favour of the policyholder – the highest uphold rate among all travel insurers.

About three in 10 (29 per cent) complaints about car insurance providers were upheld in 2018. In this area, Great Lakes had the highest proportion (42 per cent) of complaints upheld.

Insurers not handling complaints fairly

Which? said the rise in insurance complaints, particularly regarding building and travel insurers, suggests providers may not be handling claims fairly, forcing customers to turn to the ombudsman.

Using keywords to analyse five years’ worth of complaints data, Which? found the three most commonly disputed issues between policyholders and insurers were exclusions, non-disclosure and pre-existing conditions.

Jenny Ross, Which? money editor, said: “Our analysis reveals a steep rise in insurance complaints referred to the ombudsman, and while it is encouraging that consumers feel empowered to challenge insurers, we have concerns that firms may not be handling claims fairly.

“When choosing an insurance firm it’s worth checking its record with the ombudsman to gauge how it treats customers – a firm with a high proportion of complaints upheld in favour of customers should be a red flag.”