1. Role of the Ombudsman for Long-term Insurance
Presentation to the Select Committee on Finance
National Council of Provinces   
Ron McLaren
Ombudsman

2. The Office Established on 1 January 1985
Voluntary financial ombudsman scheme recognised by statute
Voluntary association not for gain
Independent Ombudsman’s Council
Free complaints resolution service
Complaints against life insurance companies
Arising from policies which insure life, funeral, credit, disability, health and investment policies

3. Features of the office Effective, efficient and fair procedures
Equity/fairness jurisdiction
Independent and impartial
Accountable for governance and performance only to Ombudsman’s Council
No accountability to or instructions from insurers
Readily accessible
Confidentiality
No monetary jurisdictional limit

4. How the office works Rules regulate complaints resolution process
Informal – not a court – no lawyer required
Resolution through mediation, failing which determination
Provisional ruling followed by final determination
Decisions binding on insurer – complainant retains other remedies
Internal appeal procedure
Independent external assessor
Quality control

5. Key Statistics - 2016 Written requests for assistance - 9 871
Complaints received
Cases and transfers finalised
Percentage of cases and transfers resolved
wholly or partially in favour of complainants - 37,4%
Recovered for complainants in lump sums - R187,6m
Compensation awarded to complainants for
poor service by insurers - R

6. Types of benefit in complaints finalised 2016
Funeral
35%
Health
11%
Life
34%
Types of benefit in complaints finalised 2016
Credit Life
10%
Disability
10%

7. Summary of cases finalised
2016
% of Total
Poor service
30.75%
Claims declined
49.46%
Non-disclosure
5.32%
Policy performance
3.55%
Surrender values
1.53%
Misselling
0.19%
Lapsing
3.91%
Miscellaneous
5.29%
TOTAL
100%

8. Challenges and possible solutions
Poor complaints handling by insurers
Publication of complaints data
Compensation for poor service
Draft legislation aims at improvement (FSR Bill, Treating Customers Fairly and Policyholder Protection Rules)
Liaison Committee