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ICOB 7.3 Claims handling: general

Requirement to handle claims promptly and fairly

ICOB 7.3.1R

An insurer must carry out claims handling promptly and fairly.

ICOB 7.3.2G

When handling the claim of a retail customer, an insurer should comply with the rules and guidance in ICOB 7.5. When handling the claim of a commercial customer, an insurer should ensure that:

  1. (1)

    the commercial customer is kept reasonably informed of how his claim is progressing; and

  2. (2)

    payment is made promptly once settlement terms have been agreed.

ICOB 7.3.3G

An insurer should refer to the guidance in SYSC 3.2 (Areas covered by systems and controls) in its procedures for claims handling. For example, an insurer should have in place systems and controls which take account of reasonably foreseeable peaks in demand, to allow it to deal with claims promptly in such circumstances.

ICOB 7.3.4G

An insurer should refer to the guidanceset out in TC 1 (Commitments) in respect of the competence of any person who carries out claims handling on its behalf.

Giving customers guidance on claiming

ICOB 7.3.5R

When an insurer is informed that a customer wishes to claim under his policy it must give the customer reasonable guidance to help him make a claim under his policy.

Rejecting or refusing claims

ICOB 7.3.6R

An insurer must not:

  1. (1)

    unreasonably reject a claim made by a customer;

  2. (2)

    except where there is evidence of fraud, refuse to meet a claim made by a retail customer on the grounds:

    1. (a)

      of non-disclosure of a fact material to the risk that the retail customer who took out the policy 1could not reasonably be expected to have disclosed;

    2. (b)

      of misrepresentation of a fact material to the risk, unless the misrepresentation is negligent;

    3. (c)

      in the case of a general insurance contract, of breach of warranty or condition, unless the circumstances of the claim are connected with the breach; or

    4. (d)

      in the case of a non-investment insurance contract which is a pure protection contract, of breach of warranty, unless the circumstances of the claim are connected with the breach and unless:

      1. (i)

        under a life of another contract, the warranty relates to a statement of fact concerning the life to be assured and that statement would have constituted grounds for rejection of a claim by the insurer under ICOB 7.3.6 R(2)(a) or (b) if it had been made by the life to be assured under an own life contract; or

      2. (ii)

        the warranty is material to the risk and was drawn to the attention of the retail customer who took out the policy1 before the conclusion of the contract.