The Chartered Institute of Loss Adjusters (CILA) has told Insurance Business it will appear before MPs after having been accused in a recent hearing of failing to respond to a Treasury Committee inquiry despite repeated requests for the organisation to give evidence amid politicians’ concerns around loss adjuster accountability and incentives.
In a Thursday statement provided to Insurance Business following the scolding, CILA pledged to appear before MPs on the matter.
During 7 June proceedings, Rushanara Ali MP called for an insurer inquiry into loss adjuster accountability and incentives and warned that “there may be something that needs correcting”. She further took aim at CILA for its lack of engagement with the committee. The politician labelled the professional organisation’s alleged inertia as “pretty unheard of”, with the committee said to have attempted to contact it via emails and telephone calls and having left voicemails.
“It's very concerning that loss adjusters can't be bothered to respond to a parliamentary committee, which has considerable power and influence over what happens in this arena, and we're trying to be helpful,” Ali said.
The Labour MP levelled accusations that insureds are “getting delaying tactics” and “bad practice” from loss adjusters, and that this could be “widespread”.
MPs gave the example of the Galpin’s Road gas explosion, in which a young girl was killed and hundreds of families were required to evacuate in the aftermath, as an example of claims service failures. The local authority, rather than insurers, has since spent £2 million on alternative accommodation and individuals have faced delays getting back to their homes due to loss adjuster timelines, Siobhain McDonagh MP said.
In the full 8 June statement, CILA said: “The CILA is most grateful that the Parliamentary Committee have reached out to us for a view on this issue.
“This certainly a most important matter as noted by the committee. Not least in view of financial and emotional impact on Policyholders but also the need for fair customer outcomes on all claims.”
“The CILA is predicated on professionalism and expertise to enable appropriate behaviour to secure these fair customer outcomes,” it continued. “The CILA also should like to highlight that there are considerable complexities around this matter and would very much appreciate the opportunity to formally and in person make representation to the committee.
“Therefore we reiterate our most grateful thanks for this second approach by the Committee with the request that a meeting may be arranged.”
Insurers also faced criticism during proceedings and were accused by Ali of operating with “considerable complacency” where it comes to third parties.
“There's something going wrong here and it's not really on for insurers to be using an industry group that can't be bothered to respond, and it's been some time since those required requests were made,” Ali said.
The MP accused third parties of “damaging insurance companies’ reputations” and quizzed insurer representatives how they are “holding [loss adjusters and other third parties] to account”.
Charlotte Clark, ABI director of regulation, who appeared on the panel to give evidence alongside Aviva CEO UK & Ireland life Doug Brown and Admiral UK CEO Cristina Nestares, said in response to the inquiry call that the insurer association is unaware of any “systematic” problem with loss adjusters and committed to raising the issue with the association’s general insurance committee.
“I think it's a little unfair – I mean, I'm saying that the FOS [Financial Ombudsman Service] hasn't raised it with us and the FCA haven't raised it with us, so, you know, if there is a systematic issue, then we will, we will talk to members, and we will definitely report back in terms of … what we see,” Clark said.
