Advisers can meet the FCA’s 3-day rule on complaint handling with the right support, according to Jonathan Newell, founder and CEO of insurance firm BareRock.
Newell believes the current industry framework, along with outdated systems, makes complying with the 3-day rule “virtually impossible” for most firms. This includes standard notification requirements as well as the process of engaging and awaiting instructions from insurers, which leads to a breach of the threshold.
He has a vested interest in the matter, with his firm now offering services which he says can help advisers meet this obligation and avoid breaching their professional indemnity insurance (PII) policy.
The BareRock offering includes a “unique clause” and template wording that enables firms to directly address complaints within the required 3-day period, provided that the value of any redress falls within their excess amount.
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Newell said: “The 3 day rule framework was designed to benefit both customers and advice firms with a mechanism to resolve complaints quickly. However, using it successfully is hindered with barriers and negative friction points, including the usual PII claims handling provisions.
“Breaching the 3-day limit means firms have no choice but to trigger their formal complaint resolution process. Often, we’re talking about minor issues that could and should be resolved immediately, without PII frustrating the situation.
“The outdated thinking adopted by the legacy market is damaging reputations of thousands of advice firms. This is driving poor customer outcomes because of red tape and a lack of lateral thinking – nobody benefits.”
Maddie Delboy, compliance manager at the Verve Group, added: “On the surface, the FCA’s 3-day summary complaint resolution guideline feels like the proactive compliance that we like to see and support. However, we are well aware that in reality, this resolution is essentially redundant on the basis of the requirement for firms to notify PI insurers, and the mismatch on time scales.
“BareRock’s innovative policy is a game-changer and we will be able to guide firms to swiftly resolve complaints, within their excess, enhancing client satisfaction, without compromising insurance obligations.”
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