The Financial Ombudsman Service (FoS) has sounded the alarm with recent data revealing a notable uptick of over 13,000 complaints in the first half of 2023 compared to the previous six months.
This surge, gained in insights from the 2023 Gartner CIO and Technology Executive Survey, spotlights a trend of discontent within the financial services sector, particularly post-purchase.
The figures, preceding the launch of the Financial Conduct Authority’s (FCA) Consumer Duty, underscore a critical juncture in the customer journey. The Consumer Duty, designed to instigate a ‘paradigm shift’ in financial service delivery, emphasises the need for positive customer outcomes. Regarding automotive finance and insurance (F&I), post-purchase grievances take centre stage, with concerns such as end-of-agreement charges, including excess mileage or damage fees, taking a prominent role in customer complaints.
These complaints unveil a recurrent theme where customer satisfaction wanes after the initial thrill of a new car acquisition has faded.
In response to this trend, industry experts advocate for a proactive integration of the customer’s post-purchase journey into the fabric of F&I models.
Recognising the potential for long-term retention and enhanced reputation, this approach aims to address the root causes of dissatisfaction beyond the point of sale.
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The identified complaints by the FOS underscore the paramount importance of clearer communication and transparency in the post-purchase phase. Retailers are urged to tackle these issues head-on, considering solutions to mitigate unexpected costs, such as end-of-agreement charges on Personal Contract Purchase (PCP) and Personal Contract Hire (PCH) agreements.
One proposal, by AutoProtect, involves making SMART insurance accessible and cost-effective at the point of sale. This move not only shields customers from unforeseen wear and tear costs but also adds value to their part exchange, offering a win-win scenario for both customers and dealers.
AutoProtect is a motor insurance provider specialising in GAP insurance, warranty, vehicle paint protection, business management, sales management, FCA regulatory consultancy, compliance advice, and minor damage protection.