Customers do not face unreasonable post-sale barriers imposed by financial service providers to change product, switch provider, submit a claim or make a complaint.

Principle 6: Claims, Complaints & Changes


What that means:


In short, if a customer wants to switch providers, make a claim, or even complain, it must be simple to do so.


A slow response to these things from financial companies is not fair to the consumer. In fact, any time a customer interacts with a company they must respond and or deliver in a reasonable time frame.


‘Put it in writing’ is no longer an acceptable response when a customer wishes to complain or make their concerns known. An example, 3 months to switch bank accounts is not a reasonable amount of time, 7 days is. Insurance claims must be dealt with in a timely manner to meet the needs of the claimant.


Post-sale barriers to fair treatment can be cultural, contractual, or competitive. The customer ought to be able to change products or switch providers without incurring excessive penalty. Similarly, FSP’s should not make it unnecessarily difficult for customers to make claims or to complain when something goes wrong.


In the sections following, the requirements in terms of outcome 6 are considered. The requirements have been concluded from the generic self-assessment questions developed by the FSCA and should, therefore, only be used as a guide for FSP’s to develop their own processes and procedures to ensure delivery of outcome 6.


Customers must be informed of the changes they may make to products if their needs or circumstances change and of any important limitations on the ability to access funds or make changes. This information must be conveyed to the customer in good time and not only on request.


Management must ensure that when a representative becomes aware of a change in a customer’s needs or circumstances, including affordability difficulties, the customer must be informed about the changes they may need to consider meeting changing requirements.


FSP’s must have clear service standards in place for processing product changes, including where the financial services provider needs to refer the request to another party to deal with. Customers should be informed of the service standards for processing changes.


When a request for a product change is received, the customer must be informed of the potential risks associated with the change, in reasonable time for the customer to respond to or act on the information.


Where a request for a product change is declined by any party in the value chain, the customer should receive clear reasons for it.


FSP’s must have clear service standards in place for processing switches to other financial services providers. The customer should be informed of these standards and customers should be informed of any potential risks associated with the switch.


Prior to contracting, customers have to be informed of the circumstances under which claims requests will not be processed, and the customer’s obligations in this regard must be explained. Furthermore, customers should be informed of how to submit a claim or disbursement request, of the service standards, as well as the information needed to process the claim or request.


FSP’s must test their claims and/or disbursement handling process to ensure that it is suitable for the product and target customer group concerned. Specific training must be in place for claims and disbursement processing staff, the training must also consider the TCF outcomes of fairness.


Once a claim has been received, customers should be kept informed of the progress.

The customer’s expectations and the TCF objectives must be considered before repudiating or declining a claim or disbursement request. Where a claim gets repudiated or a disbursement request declined, the customer must be given clear reasons for this.


The financial services provider must analyse types of claims and claims repudiation experience of different representatives to identify any miss-selling risks.


It is very important the complaints handling process of a financial services provider meets the stipulations of the General Code of Conduct and that of the TCF initiative.


A financial services provider must maintain an internal complaint resolution system based on a comprehensive complaints policy outlining the FSP’s commitment to, and systems and procedures for, internal resolution of complaints.


The following elements must underlie the complaints policy:


  • Transparency and visibility: Ensuring that customers have full knowledge of the procedures for resolution of their complaints
  • Accessibility of facilities: Ensuring the existence of easy access to such procedures at any office or branch of the financial services provider open to customers, or through other means such as post, fax, telephone/electronic helpdesk support
  • Fairness: Ensuring that a resolution of a complaint can during and by means of the resolutions process be affected which is fair to both the customers, the financial services provider, and the staff of the financial services provider


FSP’s must adhere to the following minimum requirements for the resolution of complaints:


  • Availability of adequate manpower and other resources
  • Adequate training of all relevant staff
  • Ensuring that responsibilities and mandates are delegated to facilitate complaints resolution of a routine nature
  • Ensuring that there is provision for the escalation of non-routine serious complaints and the handling thereof by staff with adequate expertise
  • Internal follow-ups to avoid occurrences giving rise to complaints or improve sevices.

The financial services provider should adhere to the following general rules for handling complaints:


  • The financial services provider must assist a customer who has a complaint to lodge it inwriting
  • Records of complaints must be kept for a minimum of five (5) years
  • Complaints must be dealt with in a timeously and fair manner
  • The complaint investigation must be stared as soon as possible and must be responded to promptly
  • The customer should be told of what further steps to take under FAIS or any other law if the customer is not satisfied with the resolution offered

The internal complaints resolution system and procedures, including any updates or upgrades must be in writing. Customers must have access to the internal complaints resolution system and procedures at every branch or electronically and customers must be made aware of the procedures by public press, electronic announcements, or customer communications.


The complaints resolution system and procedures must contain the duties of the financial services provider and the rights of the customer. A clear summary of the Act pertaining to the pursuance of a claim through the Ombud after dismissal of a claim by the FSP must also be included as well as the contact details of the Ombud.


The internal complaints resolution system and procedures procedure must stipulate the following:


  • Complaints should, if possible be in writing and copies of relevant documentation should be attached thereto
  • The FSP must provide acknowledgement of receipt of complaints in writing within three Such acknowledgement must include the details of staff dealing with complaints
  • Complaints must be properly recorded by the relevant staff
  • After receiving and recording the complaint, the complaint must as soon as possible be forwarded to the relevant staff appointed to consider its resolution
  • The complaint must receive proper consideration and that appropriate management controls are available to ensure that the consideration process is effectively controlled
  • Management controls must ensure that decisions are objective, consistent for similar complaints and that decision makers do not have a conflict of interest
  • The customer must be informed of the results of the consideration within six weeks
  • Where the outcome is not favourable to the customer, full reasons must be provided, and the customer advised that the complaint may be pursued through the Ombud within six months and the Ombud’s details must be provided

Where a complaint is resolved in favour of a customer, full and appropriate redress should be offered to the customer without delay.


The financial services provider must test the complaints process to ensure it is accessible and appropriate for the customer group.


The complaints policy must also include procedures to ensure that complaints are used to drive improvement and ensure, as far as possible, that when something has gone wrong the same thing does not happen to someone else.


FSP’s must have processes in place to determine the root causes of complaints. Complaints should also be analysed to identify any risks of miss-selling, whether by the financial services provider’s own representatives or other third parties.


A follow-up should be done to determine customer satisfaction after the finalisation of complaints.


Redress allows a financial services provider to put things right, remedy grievances and to offer compensation where appropriate. Redress should be proportional to the degree and nature of the failure and hardship or injustice suffered.


FSP’s must have a redress policy ensuring that customers receive appropriate redress if subject to unfair service, irrespective of receiving a complaint.


Where a request for redress is decline, wholly or partially, the financial services provider must inform the customer of what steps the customer can take to have the decision reviewed.


Redress for the complainant may include some or all the following:

  • An apology
  • An explanation
  • Practical action to mitigate any detriment
  • Reimbursement of actual loss and/or costs incurred
  • A modest payment in recognition of time and trouble taken to make the complaint or as a tangible expression of regret
  • Other appropriate action suggested by the complainant or the registrar of Ombud for financial services providers