An ombud for every complaint

2014-05-25 15:00

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Dealing with a financial services company when you have a complaint can be time-consuming and sometimes frustrating. But there is help at hand, which is also free of charge.

There is a range of financial services ombudsmen offices, each of which specialises in complaints related to a specific sector.

You have to give the financial services company a chance to resolve your complaint before you take it to the ombud’s office. Neesa Moodley-Isaacs looks at the options available to you

The Financial Advisory and Intermediary

Services Ombud

Noluntu Bam

Bam deals with all complaints related to financial advisers. However, the ombud is limited to dealing with complaints that relate to incidents after September 30 2004 and can only award complainants a maximum of R800?000.

For example, if an adviser fails to inform you how much his fee will cost or invests your money in a property syndication without carrying out due diligence first, you can complain to the Financial Advisory and Intermediary Services Ombud.

Case study: Charles Griffiths lodged a complaint against financial adviser Alwyn Smit after Griffiths initially approached him for advice regarding retirement planning. Smit advised Griffiths to replace his Discovery life assurance policy with an Old Mutual policy.

He was also advised to surrender three savings plans and invest the money in an existing Galaxy investment plan. On Smit’s advice, Griffiths also invested money in a Max Investments plan, which he understood would mature when he was 65.

However, Griffiths soon found the automatic premium increases on the Max Investments plan were unaffordable and then discovered the investment would only mature when he was 75, not 65.

He was forced to surrender all three investments because he could no longer afford them and ended up paying massive penalties.

The Financial Advisory and Intermediary Services Ombud found that large upfront commissions influenced Smit’s advice and his advice had been inappropriate.

She ordered Smit to pay Griffiths an amount of R211?442.56.

Contact details

Telephone: 012?470?9080

Email: info@faisombud.co.za

Website: www.faisombud.co.za

The Long-Term Insurance Ombud

Judge Ron McLaren

Judge McLaren deals with all complaints related to life insurance, dread disease cover, income protection cover, funeral policies and hospital cash plans.

For example, typical complaints include cases where insurers did not provide you with sufficient information regarding the terms and conditions of your policy or under what circumstances the policy will pay out.

Case study: The policyholder died without having named a beneficiary on his life insurance policy. His ex-wife claimed the benefit from Safrican Insurance Company.

She gave the insurer a copy of their divorce order and was paid the benefit of R26?000.

However, his mother then lodged a complaint with the ombud, stating that she was a pensioner and had covered the funeral costs. The ombud ordered Safrican Insurance to pay the benefit to the mother.

Contact details

Telephone: 021?657?5000 or 0860?103?236

Sharecall: 0860?662?837

Email: info@ombud.co.za

Website: www.ombud.co.za

The Short-Term Insurance Ombud

Dennis Jooste

Jooste deals with insurance complaints related to household contents and building cover, vehicle insurance, cellphones, travel and credit protection insurance. For example, a claim may relate to a declined claim where you feel that the claim should have been paid out.

Case study: The complainant bought a second-hand car and a month later, the engine caught alight while he was driving the car.

Although the complainant had taken out comprehensive insurance, the insurer, Lion of Africa Insurance, declined the claim on the basis that the damage fell within a specific exclusion dealing with wear and tear, mechanical or electrical breakdown or failures.

However, the ombud pointed out that fire was an insured peril under the comprehensive car policy and ordered the insurer to settle the claim in full.

Contact details

Telephone: 011?726?8900

Sharecall: 0860?726?890

Email: info@osti.co.za

Website: http://osti.co.za

The Credit Ombud

Manie van Schalkwyk

Van Schalkwyk handles all complaints related to your credit profile. For example, if the information on your credit profile is incorrect.

Case study: The complainant accidentally paid money into a credit card that had already expired. She immediately asked the bank to correct her error.

However, when she later applied for more credit, the bank turned her down on the grounds that she had a bad credit rating.

On querying the matter at the credit bureau, she found that the correction she requested had never been made and her credit record now reflected a default payment. The complainant again contacted the bank and requested that her credit record be corrected.

But after almost two months, this had not been done. The Credit Ombud ordered the credit bureau to immediately correct her credit record.

Contact details

Telephone: 0861?662?837

Email: ombud@creditombud.org.za

Website: www.creditombud.org.za

The Pension Funds Adjudicator

Muvhango Lukhaimane

Lukhaimane investigates all complaints related to pension funds, including retirement annuities, pension funds and provident funds.

For example, a complaint could relate to the split of a couple’s pension fund interest on divorce.

Case study: The complainant told the Pension Funds Adjudicator’s Office that he had never received a benefit statement from his employer, WRS Security Services, confirming that he was a member of the Private Security Sector Provident Fund or what his fund credit was.

An amount of R187.50 was deducted from his salary every month as a provident fund contribution.

However, the provident fund told the pension funds adjudicator that WRS Security Services was not registered as a participating employer and the fund had no record of the complainant’s benefit.

It is compulsory for employers in the private security industry to join the Private Security Sector Provident Fund.

WRS Security Services was ordered to register with the fund and to submit all outstanding contribution schedules to the fund so that the complainant’s arrears contributions could be calculated.

The company was also ordered to pay the fund all the arrears contributions, along with late payment interest, and to provide the complainant with a copy of his latest benefit statement.

Contact details

Telephone: 012?346?1738 or 012?748?4000

Email: enquiries@pfa.org.za

Website: www.pfa.org.za

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