Swinton apologises after £7.4m mis-selling fine
MANCHESTER based high street insurer Swinton, has been fined nearly £7.4m by the Financial Conduct Authority for the mis-selling of monthly add-on policies.
The watchdog said that Swinton’s “aggressive sales strategy” meant that it failed to treat customers fairly in its telephone sales of monthly add-on insurance policies. The insurer has now apologised.
The FCA said that between April 2010 and April 2012, the French-owned group did not provide enough information to customers about the key terms of the policies and also failed to properly monitor its sales calls.
Swinton has set aside £11.2m to repay those customers who were mis-sold, of which £1.9m has already been paid out, the FCA said.
The insurer has now contacted over 650,000 customers it thinks may have been affected. Any policy holders who believe they bought monthly cover as a result of mis-selling should contact Swinton directly, the regulator says.
Tracey McDermott, the FCA’s director of enforcement and financial crime, said: “Swinton failed its customers. When selling monthly add-on policies, Swinton did not place the consumer at the heart of its business. Instead it prioritised profit.
“At the FCA we have been clear in our expectation that firms must behave in the interests of consumers. Today’s outcome shows our approach in action and will act as a deterrent for other firms tempted to put profit figures above the fair treatment of customers.”
The watchdog said the £7.38mn fine reflects the number and seriousness of the issues raised during the investigation. The fine was reduced from £10,543,500, with a 30% discount applied as Swinton settled at an early stage in the FCA’s investigation.
Swinton’s chief executive Christophe Bardet said: “We apologise for these shortcomings. They were not compatible with the proud history of Swinton, which since 1957 has been providing peace of mind to people through insurance cover.
“As the biggest high-street insurance retailer in the UK, with 500 branches, we are part of the community for more than 2m customers.
“Our focus is now to deliver on our promise of insurance with a personal touch. Swinton is embarking on a £60m investment in growth which puts the customer at the heart of everything we do.”
Swinton said after the appointment of Mr Bardet in December 2011 he had instigated a full review of the business.
The company then notified problems to the Financial Services Authority in March 2012.
In April last year sales scripts were changed and monitoring practices improved to ensure they fully comply with FCA principles.
