Low complaints figures may indicate claims management companies are not as bad as they are commonly perceived, the Legal Ombudsman has said.
A new report on the first six months of handling CMC complaints shows the ombudsman accepted 648 complaints from January onwards.
The number was lower than predicted and prepared for, and the ombudsman said it gives some cases for ‘positive reflection’.
The report says: ‘Perhaps the service levels of CMCs aren’t as bad as the public perception of them would suggest. This lower level of complaints correlates with a reduction in the number of surrendered, suspended and cancelled authorisations of CMCs by the regulator. There were roughly half as many authorisations cancelled in 2014/15 compared to the previous year.’
The ombudsman said the relatively low number of complaints was not reflected in public opinion.
A survey conducted by the complaints-handler found that 68% of respondents were not confident that their consumer rights would be protected when dealing with a CMC, compared to 38% who said the same of banks.
More than three-quarters of the public are not confident that CMCs tell the truth to their customers.
The report said this perception is likely to be fuelled by complaints of cold-calling, although the ombudsman gave credit to the claims management industry for reducing interventions by the regulator.
The ombudsman said it resolved 478 cases in the first six months of handling CMC complaints, with around half requiring a remedy to put things right for the customer. The average financial remedy ordered was £650.
Two-fifths of disputes were about costs, with 23% related to delays in progressing claims or a failure to progress cases properly.