During one of our initial conversations with Daniel Crockford, he explained to us that in the UK there was an independent organization which would investigate unfair practices and denials called Financial Ombudsman Service (FOS). The FOS has a complaint process which is available to everyone with a Lloyd’s of London policy.
The Financial Conduct Authority (FCA) regulates the financial and insurance industry of UK based companies including Lloyd’s of London. If an individual feels they are not treated fairly they can submit a complaint to the FOS and it will be investigated. If the FOS determines that the complainant is correct, the FOS has the authority to force the respondent to pay. Companies do not want cases heard by the FOS because the results are made public. An unfavorable decision reflects poorly on the company and most do not want that exposure.
This service is also free to the complainant, making it very attractive over seeking expensive legal council. Also in the UK court system the looser pays, significantly increasing the risk of the complainant. This service is intended to equal out the playing field of the large powerful corporation against the individual.
There is also the Lloyd’s of London complaint process. If you have a Lloyd’s of London policy, you can complain to them. In fact, you are supposed to complain to them prior to the FOS. They provide the opportunity for the syndicates internal complaint department to address it. If the result is not satisfactory to the complainants than there is a complaint process within the overseeing Society of Lloyds.
The SOL complaints department will hear the complaint and make a determination. According to the internet, the majority of the cases are overturned. However, if the individual is not satisfied, they still has the ability to go to the FOS.
Recent changes to Lloyd’s complaint process
Here is where it starts to get convoluted. Effective January 1, 2017, Lloyd’s of London changed their process. If the policyholder is non-UK, and the response from the syndicate’s complaint department is not acceptable, the individual is referred back to the department of insurance in the state where the policy was purchased.
We went to the Indiana Department of Insurance where we live and Florida Department of Insurance where Blue Water Insurance is based. Neither have the authority to address the issues within their complaint process. Therefore, it appears that the Society of Lloyd’s sends us into a black hole and effectively the syndicates have no regulatory oversight. Our only option would be costly arbitration.
Daniel Crockford, our UK solicitor, believes that our case should be heard by the FOS.
Our policy was written in the UK by a FCA regulated company, LJJ. We paid for the policy via Blue Water Insurance, US broker. However, our policy is with LJJ Associates. The policy is underwritten by ProSight Syndicate 1110 which is also regulated by the FCA. The IDOI doesn’t have authority over these organizaitons, therefore it makes sense that our case is investigated by the FOS.
The procedural change is the Lloyd’s of London procedure and not the FOS complaints procedure. So we submitted our complaint to the FOS on July 15, a few days after we had received the final claim denial from ProSight’s complaint department.