Complaints to South Africa's Financial Advisory and Intermediary Services Ombud surged 45% in 2024/25, reaching 15,404 cases, with long-term insurance like funeral policies dominating. The office awarded R31.748-million in compensation while improving case resolution times. Advocate John Simpson highlighted growing consumer awareness as a key driver.
The Financial Advisory and Intermediary Services (FAIS) Ombud reported a 45% increase in complaints for the 2024/25 financial year, receiving 15,404 submissions compared to 10,574 the previous year. Advocate John Simpson, the FAIS Ombud, attributed much of the rise to general inquiries, stating, “a substantial increase in consumer awareness of our office. People appear to know about us far more than before and they’re contacting us.” Of these, 3,382 fell within the office's jurisdiction, a decline from 4,501, partly due to a 31.5% annual reduction in complaints against the 10 largest financial service providers since 2022.
The office closed 3,543 cases, down from 5,046, with 41% resolved through awards or settlements. Compensation totaled R31.748-million, and the average closure time improved to 59.28 working days, with 98.06% of cases finalized within six months—exceeding the 85% target. Long-term insurance, especially funeral policies, accounted for 52.84% of formal cases, followed by short-term insurance at 12.36% and investment advice at 11.80%.
Two formal determinations targeted funeral policy providers for misconduct. In one, a provider was ordered to pay R20,000 plus interest for operating without an underwriter and mishandling a premium dispute. In another, a firm had to settle R5,000 after failing to notify a client of a premium increase, breaching Policyholder Protection Rules.
Investment cases revealed risks, such as a R3-million placement expecting R20,000 monthly income without capital loss; the provider neglected to warn of the unsustainable 9.5% withdrawal rate, leading to a R75,000 settlement. A vehicle insurance claim was upheld after the provider relied on a general email for notification, which Simpson deemed “not sufficient compliance with the Code.”
Simpson announced a new online case summary initiative for transparency, allowing financial service providers and complainants to review similar past cases. He emphasized, “Justice, fairness and the rule of law are more important than chasing numbers. Our priority is to deliver fair, logical judgments that are properly reasoned and explained.” The office is integrating with the National Financial Ombud Scheme.