Insurers told to improve cold calling practices
Published On 26 April 2007
The Financial Services Authority (FSA) has warned insurance companies that they must improve the standard of their cold calling.As part of its drive to ensure financial service companies treat their customers fairly, the FSA monitored the practices of 43 insurers who cold call customers in order to sell them cover.
However, the FSA found that the standard of call was "poor" and that the insurer often failed to disclose significant exclusions and limitations to potential customers.
People selling personal accident insurance, health cash plans and accident and sickness insurance policies were singled out for particular criticism and the FSA said that companies must act immediately to improve the situation.
"The quality of cold calling in general insurance sales was disappointing – consumers were pressurised and the benefits of the product were sometimes exaggerated," said Vernon Everitt, the director of retail themes at the FSA.
"The bottom line is that firms must never pressurise consumers into making a rushed decision and must always clearly spell out the nature and limitations of the products."
Mr Everitt added that consumers should never buy insurance if they feel they are being pressurised or rushed into a purchase they are uncertain about.
"Step back and take all the time you need to make sure the insurance is right for you," Mr Everitt advised.
