Sunday 27th August, 2006


Reporting grievances in customer’s best interest

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There is an amusing picture in the magazine Business 2.0 of July ‘04. It’s a picture of a medicine bottle labelled: “Take two tablets, two times daily, to Save $$$.” Sometimes I think that’s a really useful prescription.

You see, some of us are so thick-skulled, when it comes to doing what’s right for ourselves and our families, the irony confounds me! The irony is that the wrong people come along and serve up skulduggery and some of us actually bite hook, line and sinker.

The truth is that unethical behaviour on the part of those who present themselves as financial advisers, and insurance salesmen is a recurrent problem. Thank God that the Central Bank inspectors are currently seeking to bring legislation to address the problem.

Therein was a major failure of the Insurance Act 1980, which provided no real remedy for consumer redress, in the event of unethical advice and actions on the part of the financial providers and their intermediaries.

The large problem right now is that clients who complain about unethical behaviour are unwilling to put their complaints into writing. The unwillingness stems from either a humane desire to avoid getting the person/s into trouble (and cutting off their income), or a fear of lengthy court proceedings, or simply, out of sheer timidity.

The problem with all these choices is that perpetrators continue to be unscrupulous. More people are cheated and more unreported acts are unleashed upon gullible consumers.

My experience shows that it is only when the principal (the corporate company) takes a “direct hit” in terms of its own funds, that the principal will take action to dismiss such unscrupulous people. Until then, the clients and customers take all the licks.

And I make no apologies for what I have seen and experienced. This is a vexing issue!

If the regulatory authorities get the relevant complaints from customers in time, there will be concerted action to address the problem at the highest level—the level of legislation. But as long as customers are willing to suffer quietly, we’re trapped.

If the regulators experience is that unethical acts are isolated, there will be little urgency to tackle them. However, if they know the real volume and the incidence of such problems, there will be swift action, I am assured.

Another problem with unethical people is the ease with which they find employment with another similar company. What assurances do consumers have that they will not continue with undesirable behaviours at their new employers?

Can the new legislation treat with some rehabilitative training within the construct of a probation officer supervision?

One of the acute problems current in the insurance industry is rebating. Rebating is the act of returning to the client, a portion of the commissions earned by the salesman. This has become so prevalent, that there are clients who now ask for your commissions up-front. And they use that to pitch one salesman against another, often within the same company.

Such clients are themselves unethical and it is against their own interests to write a complaint. How can we remedy this subversion?

The stark reality for the rebating salesman or agent, is that if he returns the majority of his commissions to his clients, he will have very little left in his pay cheque at the end of the month. Soon enough, he will have no qualms about pocketing his clients’ money.

So they both loose, and may resort to doses of prescription medication.

I personally prefer the Bob Marley prescription in Would You Be Loved?

Don’t let them fool you…

Against the darkness,

There must come out the light!

To be continued next week

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