Jin used an insurance broker to arrange her business insurances. The policies were held by companies Jin was a director of. Each company had a separate account with the broker.
In January 2022, Jin asked the broker to pay a credit from policy refunds to one of her companies. The broker explained that the refund would be split into two payments because the credit was held across two accounts.
Jin explained to the broker that the credit should not be split. The broker had an error in their accounts: they had invoiced the wrong company for one of the policies. The company which should have been invoiced had paid the premium and should be paid the corresponding refund. Despite Jin’s explanation, the broker split the credit between two of Jin’s companies.
Jin then complained to the broker about their service. She had experienced many problems with her accounts and policies, including an error with her motor vehicle policy in 2021.
When Jin lodged a claim with her insurer for damage to her vehicle, she found out that the insurer had cancelled the policy due to non-payment. Jin had paid the broker in March 2021, but due to an internal error the broker did not pass the payment onto the insurer in March. They paid in April, after Jin made her claim.
The insurer subsequently agreed to reinstate the policy, and Jin’s claim was eventually approved, nearly a month after she made the claim.
In response to the complaint, the broker acknowledged their errors with the motor vehicle policy and that they should have processed the refund as Jin had requested. They apologised to Jin and offered her a restaurant voucher.
Jin was not satisfied with the broker’s response and asked FSCL to investigate her complaint.
Dispute
Jin said the delay with the insurer accepting her motor vehicle claim had caused her significant inconvenience and stress. Jin said the broker made it sound like she had paid them late. That was not correct. She had repeatedly followed up with them to get the invoice when the policy was renewed.
Jin was also dissatisfied with the way the broker had handled her complaint. Their apology was not sincere and they did not compensate her for their wrongs. Jin wanted a written apology from the broker’s senior management, and $5,000 compensation paid to charity.
The broker offered $250 compensation to recognise the inconvenience to Jin because of the delays with her vehicle being repaired. Jin declined the offer.
Review
We could not require the broker’s senior management to apologise to Jin.
We concluded that $500 compensation was a fair amount to recognise the inconvenience and stress the broker had caused Jin with the motor vehicle policy. The vehicle repairs were delayed and it would have been stressful for Jin while she waited for the insurer’s decision on whether they would reinstate the policy.
We initially concluded that the way the broker processed the credit did not warrant compensation for non-financial loss. However, Jin then proposed a token payment of at least $100 to recognise her staff’s time. The broker said they were willing to pay $100 and we considered that Jin’s request for a token payment was not unreasonable.
Outcome
We awarded $600 compensation for non-financial loss. Jin did not accept this. We discontinued our investigation.
Insights for consumers and participants
This case did not warrant the amount of compensation for non-financial loss Jin was seeking, $5,000. This is the maximum amount we can award in a case for non-financial loss. We only consider awarding a substantial amount of compensation if the consumer has been significantly harmed and they have evidence to prove this. For example, where the consumer has medical evidence to show their health was severely or permanently impacted because of the stress or anxiety they experienced.
