More than a thousand customers also compensated
Britain’s City watchdog has slapped a £2.8 million fine on the insurance handling operation behind Phones 4U after finding it guilty of poor complaints procedures. The Financial Conduct Authority said Policy Administration Services (PAS), which handles complaints and customer relations for insurance sold by the mobile retailer, failed to keep accurate records of complaints between June 2009 and September 2011, though it did not accuse Phones 4U of any wrongdoing.
PAS has since looked into 7,099 complaints and paid compensation to 1,438 customers and, by settling issues raised by the FCA early, qualified for a 30 per cent fine reduction.
It follows a three month probe by the watchdog into how mobile phone policies are structured.
Only last week it issued a damning report criticising unnamed insurers who refused to pay out if, for instance, there was a different SIM in the handset at the time it was lost.
Others were castigated for not telling customers they could opt out of buying cover at the time of purchasing a device.
It also discovered one policy provider had rejected around two fifths of all theft claims.
* Footnote: In a separate move, another watchdog – Ofcom – has unveiled plans to force BT to lower the installation fees it charges operators who use its fibre-optic networks, including TalkTalk and Sky. Though it stopped short of stipulating exact price structures, something that TalkTalk had lobbied for, it did reduce the minimum length of wholesale contracts from one year to a month.