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Banks and insurers forced by ombudsman to pay up


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A BANK has been forced to pay compensation of €35,000 to a couple after it overcharged them for a loan.

It had failed to state the correct interest on the loan, and was forced into the pay-out by the Financial Services Ombudsman.

Ger Deering also found against an insurance company that cancelled a motor policy, claiming it had not received a key document from the consumer that it requested.

It turned out the document got trapped in the insurer’s email firewall.

Compensation of €9,000 was ordered to be paid by the unnamed insurer.

The ombudsman found in favour of consumers and small firms in some 200 cases last year, but 238 cases were not upheld.

Mr Deering recently found against AIB in a disputed tracker mortgage case, which means that the bank will now likely have to pay out on an additional 6,000 tracker cases.

However, the latest summary of cases he has published do not involve trackers. Instead, tracker case updates are to be released in the coming weeks.

Mr Deering deals with a wide range of complains relating to insurance, banking, investments and pensions.

The digest of 33 decisions he has just published shows he forced an unnamed lender to pay compensation of €15,000.

This was because the lender failed to update an individual’s Irish Credit Bureau rating to show that their debt was clear. This failure meant the consumer’s credit rating was negatively affected.

The ombudsman ordered another bank to pay compensation of €15,000 to a company.

This was because the bank threatened to close its bank account due to “outstanding debt,” which turned out to be an error.

Another insurer had to come up with €300 for a policyholder with pet insurance who had a claim rejected due to the pet’s weight.

And compensation of €3,000 had had to be paid to an individual who received less than she expected, when she made a claim on a dental policy, because of the poor information given to her by the insurer.

Mr Deering said that by publishing these decisions, the Ombudsman aims to enhance transparency and understanding of his powers and the services provided by the office.

He published 394 legally binding decisions, issued throughout 2019.

Mr Deering said he used informal mediation to successfully resolve most of the complaints closed last year.

“I believe it will be evident to anyone who reads these decisions that the work of my office can have a very profound impact on many of those who use our services. I believe that these decisions play a very important role in improving the conduct of financial service providers,” he said.

Mr Deering said that having access to these decisions will assist consumers and their advocates and financial service providers to avoid and resolve disputes.

Online Editors