ACSO warns of falling consumer support
7th August 2023Tweet
The Association of Consumer Support Organisations (ACSO) has warned of a worrying decline in the number of claims management companies since regulation was transferred to the Financial Conduct Authority (FCA) in 2019.
It has revealed that in 2011 there were 3,213 CMCs operating in the UK. That had declined to 1,238 by 2019 and as of July this year that number had fallen again to just 546.
Of these, 48% provide advice, investigation and representation, while the remaining 52% are lead generators only.
The situation is most stark in the personal injury sector. In 2011, 2,553 CMCs offered injury advice and lead generation, but of those offering advice today only 30 cover personal injury.
ACSO said, “ACSO has always believed that well-managed CMCs can offer consumers choice and access to justice that might otherwise be denied to them. Yet a combination of more robust regulation as well as impacts such as the government’s whiplash reforms mean CMCs are essentially being consigned to history, at least where personal injury is concerned.
“A good example is road traffic claims, with Official Injury Claim data showing a mere 0.3% of consumers using the portal appoint CMCs.
“It could be that ministers will hail this as a victory, but it also fits within a wider pattern of continuing reduction in organisations across the sector who support people when making a claim. That is a situation that needs careful monitoring to ensure people can get the help they need when seeking redress.
“Before the new portal came into operation, there were even concerns expressed from some in the insurance industry that it would become a ‘CMCs’ charter.’ These fears have proved to be about as wide of the mark as it is possible to be.”Tweet
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