As client complaints to the Financial Ombudsman Service soar, Rebecca Jones looks at how advisers can touch up their in-house complaints processes.
There is no denying it, client complaints are on the rise. In the 12 months to 31 March 2013, the Financial Ombudsman Service (FOS) received 4,139 new complaints about advisers, an increase of 45% on the previous year’s total of 2,857.
According to the FOS, one of the main reasons for this rise is the emergence of a new attitude among clients and consumers.
“We are seeing a shift from when people might have been very English and not complained, to now, where we are more emancipated and know we don’t have to tolerate second best,” says FOS spokesperson Rory Stoves.
How to deal with a rise in customer complaints
Of course, a willingness to complain does not necessarily follow a legitimate reason to do so, a fact underlined by the 12% fall to 42% in the rate complaints against advisers are being upheld by the FOS.
In addition, advisers are also reporting a growing number of spurious claims coming from claims management companies, the handling of which is becoming a costly burden for many firms.
However, while false or misguided claims may be prevalent, the FOS is still upholding almost half of the complaints it receives against advisers, indicating that there is still work to be done.
How you initially respond to a complaint is crucial as it will set the tone for the entire process, yet it can often be difficult to approach criticism with an open mind.
“The initial reaction usually is that it is bound to not be your fault. That is just a pure reaction – I do not think anybody likes complaints,” says Andy Snook, director at training and competence firm Performance Evaluations.
However, Snook insists that moving past that initial reaction is key to successfully resolving a complaint quickly and, most importantly, without the intervention of the FOS.
Stoves agrees: “Sometimes it just takes a bit of an explanation about why what has happened has happened, rather than just brushing off the customer as a complainant and issuing a standard letter. That is what all firms can do better,” he says.
Maintaining a positive attitude towards the client is essential to resolving their complaint.
“I think the issue is that, once someone makes a complaint, there comes a division where the client is no longer a customer but a complainant. The two need to be linked,” argues Stoves.
Even if a client is wrong, Stoves highlights the fact a complaint can still be constructive and, as such, should be handled with the same level of customer service as everyday business.
“Rather than seeing it as dealing with a complaint, it is basically offering good customer service and if you get your customer service right, it discourages them from approaching the FOS. We also find that they can become your biggest advocates,” he says.
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