Recommendation on complaints handling

Transcription

1 2011-R December 2011 (Non official translation) 1. Background Customer information on complaining and complaints handling are dealt with in several texts 1 applicable to the insurance and banking sectors. However, the inspections carried out within credit institutions, insurance entities and their intermediaries, as well as the internal control reports appendices on consumer protection and the information from clients received by the French Prudential Supervisory Authority (Autorité de contrôle prudentiel or ACP) have shown that certain procedures for submitting and handling complaints do not sufficiently protect customers 2. Consequently, the ACP recommends a series of good practices designed to ensure: the availability of clear and transparent information on procedures for handling complaints and an easy access to the complaints handling system; an efficient, equal and harmonized complaints handling process; the implementation of any corrective actions for addressing any problems identified during the complaints handling process. 2. Scope of application of the recommendation This recommendation concerns the receipt, handling and monitoring of complaints. A complaint is a statement of a customer s dissatisfaction vis-à-vis a professional. A claim, a request for information or clarification, or a request for an opinion is not a complaint. This recommendation applies to insurance undertakings, to mutual insurance societies or their unions governed by the French Mutual Insurance Code, to provident societies or their unions (hereinafter, "insurance entities"), to credit institutions and payment institutions (hereinafter, "institutions") as well as insurance brokers and banking and payment services intermediaries (hereinafter, "intermediaries"), hereinafter all together "entities", including when these entities operate in France under the freedom to provide services or the right of establishment. 1. See Appendix 1: Rules applicable to insurance entities, credit institutions and intermediaries. 2. See Appendix 2: Examples of situations in which the complaint submission and handling procedures do not provide customers with sufficient protection.

2 3. Recommendation In order to ensure a better access for customers to complaints handling systems and a greater efficiency of these systems, the ACP recommends, in accordance with Articles L II 3 and L paragraph 2 of the Monetary and Financial Code, to the entities concerned: 3.1. As regards customer information and access to the complaints handling system: To provide customers with clear and understandable information on: the complaints submission procedures for each existing level, including contact details (address, nonpremium rate telephone number, etc.) of the person(s) or unit in charge of handling complaints and the competent ombudsman where one exists. When several stakeholders are involved in the distribution or management process, this information is broken down for each category of complaints requiring a separate handling channel; the complaints handling timelines to which the entity commits itself; the existence of ombudsman charter(s) or protocol(s), where an ombudsman exists, and its/their reference(s) To make the information referred to in rapidly accessible to all customers, in particular in customer reception areas, where applicable, or on a website To acknowledge receipt of the complaint within the timeframe during which the entity has committed itself to do so, unless the answer itself is made to customers within this timeframe To keep the client informed as to the progress made with regard to the handling of the complaint, in particular when the deadline to which the entity has committed itself cannot be met due to special circumstances In the event of a complaint being rejected or not followed up (entirely or partially), to specify in the response made to customers, possible redress procedures, in particular the existence and contact details of any competent ombudsman(men) To avoid any confusion, in particular with regard to the names of departments or in the letters sent to customers, between, on the one hand, the departments of the entity and, on the other, the independent ombudsman department As regards the organisation of complaints handling: To put in place the methods and procedures for identifying letters, telephone calls and s that constitute complaints and to establish the relevant handling channels To ensure that the employee(s) usually in contact with customers or who receives(s) customer demands, has (have) been trained to clearly identify the complaints received and to make a correct use of complaints handling channels To set up an organisation for handling complaints that: Autorité de contrôle prudentiel 2

3 enables customers to submit their complaints to their usual contact person - advisor or manager - and, if they have not received a satisfactory response, to turn to a dedicated complaints handling unit, separate from advisors and managers, where the size and structure of the entity allow it 3 ; when there are several complaints handling channels 4, clearly sets out: the competent entities according to the subject of the complaint or, by default, a single entry point to which customers may submit their complaints and which will forward it to the right person and make sure a response is sent back, the transmission procedures between entities of complaints sent by mistake to the wrong person; allows the handling deadlines that have been communicated to customers to be met according to the conditions set out in paragraph 3.1 and which should not exceed: ten working days as of reception of the complaint, to acknowledge receipt, unless the actual response is given to the customer within this period, two months between the date on which the complaint is received and the date when the response is sent to the customer; clearly sets out the procedures for sending any relevant letters to the appointed ombudsman(men), where he/they exist(s); provides the procedures for registering complaints and monitoring how they are handled; defines a required level of qualification for employee(s) in charge of handling complaints, including a good knowledge of products, services, policies, tools and procedures of the entities concerned; lays down the principles of accountability and delegation within the entities concerned, in particular with regard to employee accreditation levels 5 ; includes, where the size and structure of the entity allow it, a person in charge of ensuring the compliance and efficiency of the complaints handling system To document this complaints handling organisation in procedure(s) communicated to all staff members concerned As regards the follow-up of complaints, the control of complaints handling and the rectification of shortcomings and/or bad practices identified by complaints: To implement a complaints monitoring system 6 and to report the collected data to the appropriate units or persons concerned within the entity and, where necessary, to the bodies defining the marketing 3. The complaints handling channels may be organised across the entities concerned that may be held liable with respect to the subject of the complaints. For example, as regards the complaints about the presentation of an insurance operation, the complaints may be dealt with by the different insurance intermediaries involved in this presentation. 4. Several complaints handling channels coexist when several entities are involved in the operation about which there is a complaint, in particular when insurance policies are distributed by a credit institution or when management has been delegated. 5. For example, regarding the signing of letters or gestures of goodwill. 6. For example, the monitoring could include: the customer s name, the complaint receipt date, the subject of the complaint, the policy, product or services mentioned in the complaint, the persons or entities involved other than the institution or insurance entity itself, the natural or legal persons concerned by the complaint, the date of reply to the client, the solution offered to the client (positive or negative response to the client s request), any identified failures to respect consumer protection rules. Autorité de contrôle prudentiel 3

4 policy of the entity s network as well as to all persons or entities involved in the distribution or management of the company s products or services; To identify any shortcomings and bad practices in the domain of marketing and consumer protection in order to implement remedial action at entity level and, where necessary, at the level of its network and all persons or entities involved in the distribution or management of the company s products or services; For entities legally obliged to set up an internal control system: to implement the resources and procedures necessary to ensure adequate internal control, by the entities concerned, of submitted information and of the organisation and the quality of the complaints handling, as recommended in paragraphs 3.1 and 3.2 above; to take into account and to control as part of its internal control of the entity concerned the risks to which the customers are exposed that could result from any shortcomings or breaches of consumer protection rules identified through customer complaints; to describe these actions, in particular in the appendix of the internal control report provided for this purpose, for each entity concerned. This recommendation shall take effect on 1 September Autorité de contrôle prudentiel 4

5 Rules applicable to insurance entities, institutions and intermediaries Appendix 1 The rules applicable to entities concerning the handling of complaints are primarily found in the following texts: 1. Cross-sectoral rules a) Legal provisions Article L of the French Consumer Code relating to the general obligation of all professional service providers to provide adequate information to consumers before the signature of any contract or policy and, in cases where no written contract or policy exists, to ensure that consumers are informed of the principal characteristics of a service before the execution of that service. This article applies, in accordance with Article L of the same Code, without prejudice to stricter consumer protection regulations which subject certain activities to specific rules regarding the provision of information to consumers. Article L of the Consumer Code on the provision of a normal-rate telephone number to consumers so that they can make calls relating to the execution of a contract or the handling of a complaint. b) Non-binding rules The European Commission s recommendation n 2010/304/UE of 12 May 2010, which notably includes a definition of the notion of complaint, distinguishing it from the notion of request for information. The European Commission s recommendations n 98/257 CE of 30 March 1998 and n 2001/310 CE of 4 April 2001 relating to the principles applicable to bodies responsible for the out-of-court resolution of consumer disputes, as well as Directive n 2008/52/CE of the European Parliament and Council of 21 May 2008 on certain aspects of civil and commercial mediation. 2. Provisions specific to insurance companies Article L paragraph 2 of the French Insurance Code provides, notably, that the documents given to prospective consumers should describe the consumer complaints handling procedures in place, and, where applicable, provide details of any specifically designated complaints handling bodies, without prejudice to any legal action the consumer may wish to take. This duty to provide information is also expressly incorporated into the framework of distance sales by Article L III 7 of the same Code and those of life insurance and capitalisation operations under the terms of Article A of the same Code. Article L III 7 of the French Mutual Insurance Code also includes a similar provision concerning the information that must be provided to potential members: How complaints formulated by a participating member regarding the membership form to the product s general conditions are handled and, where applicable, the existence of a special unit responsible for examining complaints, without prejudice to any legal action the complainant may decide to take, as well as, where applicable, the existence of guarantee funds or other compensation mechanisms. Article L III 7 of the French Social Security Code also provides for the communication of information regarding complaints handling by provident institutions. Article R (n) of the Social Security Code stipulates that membership policies and regulations of provident institutions must include information on: «The conditions under which the member or participant Autorité de contrôle prudentiel 5

6 can formulate complaints regarding the product s general conditions or the membership form to the product's general conditions or contract, without prejudice to any legal action they may decide to initiate Provisions specific to institutions Articles L and L of the French Monetary and Financial Code provide that, before any contractual undertaking, the payment services framework agreement must contain information on redress procedures, which must include information on complaint submission channels and complaint mediation 8. Article R I 7 of the Consumer Code (referred to by Article L of the same Code) provides that consumer credit contracts should include a clear and comprehensible section containing information relating to the handling of complaints. Articles L and R of the Consumer Code ( IV and appendix) provides that, in the case of distance sales and before the conclusion of any contract, the lender or credit intermediary should give the prospective borrower a pre-contractual information sheet, notably containing information relating to the existence of non-legal complaint and redress procedures and how these procedures can be initiated. Article L of the Monetary and Financial Code provides that all credit or payment services institutions must designate one or more ombudsman(men) responsible for recommending solutions to disputes with nonprofessional natural persons relating to services provided and to contracts concluded with regard to banking operations (deposit account management, lending operations, etc.), payment services, investment services, financial instruments and savings products. Article L of the Monetary and Financial Code provides that this Article applies notably to payment services providers and that its provisions are a matter of public order. 4. Provisions specific to insurance intermediaries Article L I of the Insurance Code provides that, before prospective consumers take out their first insurance policy with an intermediary, the latter must provide them with information relating notably to redress and complaints procedures. Under the terms of Articles R and R of the Insurance Code, with a view to handling potential disputes, the intermediary shall set out clearly and precisely the contact details and address of its complaints unit, if such a unit exists. 5. Provisions specific to banking and payment services intermediaries Articles L and R of the Consumer Code referred to above. 7. This Article covers compulsory collective operations, but its provisions are extended to cover voluntary individual or collective operations by Article R of the same Code. 8. Article 2.8 b) of the Order of 29 July Autorité de contrôle prudentiel 6

7 Examples of situations in which the complaint submission and handling procedures do not provide sufficient consumer protection Appendix 2 From the on-site inspections conducted within credit institutions, insurance undertakings and intermediaries, the appendices of internal control reports on consumer protection and information received by the ACP from customers, it emerges that some complaint submission and handling procedures do not provide sufficient consumer protection. 1. Cases where customers do not have appropriate information Customers are sometimes unaware of the information concerning complaint handling procedures and are therefore unable to identify the competent person to whom they can submit a complaint. This difficulty is accentuated when there are different players involved such as intermediaries that are independent of the insurer in the process of distributing or managing the product, banking service or insurance policy. Customers are not systematically kept informed of the handling of their complaint, which can oblige them to contact their correspondent again. Customers are not always reminded of the existence of the relevant ombudsman, where there is one, and of the procedures for submitting their complaint to the ombudsman when they receive a negative response from the complaints handling unit. The name of the unit in charge of the handling of complaints does not always enable customers to identify it as such; sometimes the name of the unit includes the word "mediation" (e.g.: "customer quality and mediation unit" or mediation unit ), in which case there is a real confusion for customers between the complaints handling unit and mediation, where it exists. 2. Cases where the organisation of the complaints handling procedure is inadequate There is no single and clear definition of what constitutes a complaint within the entities concerned. When such a definition exists, the staff do not always know about it. As a result, some customer requests may wrongly not be categorised as complaints and conversely, others that are operational in nature or which really come under business relationship management, can mistakenly be fed into the complaints channels. Complaints handling procedures are not always sufficiently formalised and may vary within the same entity or network to which the entity belongs. This is also true when customers submit their complaint to the entity's partner rather than to the entity itself. The entity's complaint submission procedures may, in practice, limit customers' ability to make complaints. This is the case when the telephone access provided to make a complaint is via a number that is subject to a surcharge or when the entity's delay in responding aggravates the customer's situation or empties the complaint of its substance. In cases where several players are involved in the process of distributing and managing a policy, the complaint submission procedures may be different depending on which entity is responsible for the subject of the complaint. These entities have not always put in place systems for communicating complaints to the relevant correspondents. As a result, when customers submit their complaint to an entity that is not Autorité de contrôle prudentiel 7

8 responsible for the area concerned and/or is not competent to deal with it, this may result in the rejection of the complaint, longer handling times or an inappropriate response. Customers who submit their complaint to their usual correspondent (customer service representative, adviser, etc.) and do not receive a satisfactory response, do not always have the possibility of having their complaint examined by a unit dedicated to complaints handling within the entity, even though the entity's structure would allow it. The place of the units in charge of handling complaints in the organisational structure may give rise to conflicts of interests or unfair treatment of the complaint, for example when the superiors of the staff involved in handling complaints are responsible for the entity's activities that may be the subject of complaints. 3. Cases where complaints are not sufficiently analysed to improve consumer protection and risk control The entities concerned have not systematically put in place appropriate monitoring of the complaints received that makes it possible, for example, to carry out proper reporting in this area. Complaints are not always analysed in order to identify shortcomings and bad practices in terms of marketing and customer protection, which can also give rise to legal and operational risks. The potential shortcomings and bad practices identified via the complaints received are not always taken into account satisfactorily in the internal control system and corrective actions at the level of the entity and, where relevant, at the level of the network to which the entity belongs and its partners. Autorité de contrôle prudentiel 8