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ombudsman news

issue 108

March/April 2013


I handle complaints for a bank and I'm trying to help one of our customers who says that we took too long to open a business account for her. The account should have been up and running within a week, but we took two months to sort it out. I want to offer compensation for the inconvenience we caused, but I'm finding it hard to come up with a figure. The customer says that she lost business because of our mistake. Is this something we should be paying out for?

If the consumer can show that the bank's mistake led to her business losing money, then the fair thing to do is to put her back in the position she would be in if the mistake hadn't happened.

If we were dealing with a complaint like this, we would ask the consumer for evidence to support what they were saying - for example, emails, receipts and invoices.

For some people, not having an account for two months would be very annoying, but it wouldn't stop them running their business. Other consumers - for example, those who rely on taking card payments - could be really disadvantaged by the delay.

Talk to your customer to find out exactly how she was affected and whether she experienced any other "losses" like inconvenience or reputational damage.

Together you might be able to come up with a sum that is reasonable and that makes up for the mistake. You might find it helpful to have a look at our technical note on compensation for non-financial loss to see examples of the types of payments we have told businesses to make.

We provide home contents insurance for a consumer whose house was burgled. Unfortunately, one of the items stolen was a Rolex watch, which was a gift from the consumer's father before he died 10 years ago. All Rolex watches have a unique registration number, so we normally only pay claims where the consumer can give us this number and it matches the database. Our consumer doesn't have the number, but he has provided photos of him wearing the watch that look like they were taken over several years. What would the ombudsman think if we declined the claim?

When it comes to proof of ownership in insurance complaints, we focus on what it is fair and reasonable to expect the consumer to be able to show.

From what you have told us about this particular case, it doesn't seem unusual that the consumer hasn't kept the receipt because it was a gift from his father.

It also sounds as though he has had the watch for a long time. We would look at the photos, take the loss adjuster's findings into account and speak to the consumer to help us make a decision.

Depending on the circumstances of the case, we might conclude that refusing to pay the claim simply because the registration number was missing was not a fair decision.

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ombudsman news gives general information on the position at the date of publication. It is not a definitive statement of the law, our approach or our procedure.

The illustrative case studies are based broadly on real-life cases, but are not precedents. Individual cases are decided on their own facts.