According to the Consumer's Association's magazine, here is what happened to me.
|From "Which" magazine, 6 Feb 2003, P5|
TRAUMA OF DELAYED CLAIM
Picture of me captioned "Barclays tried to repossess Simon's home, even though he had mortgage insurance with the bank".
Simon Richardson is around £3,000 out of pocket, and his health and home were jeopardised by the delay of one arm of Barclays in processing an insurance claim to pay another arm. To add to the insult, his credit rating has been damaged, and he can't now switch his mortgage or bank account, so he is stuck with Barclays.
Simon, from Surrey, wisely had mortgage protection insurance to cover him in case he lost his job. Both the mortgage and insurance were with Barclays.
In August 2001 work ran out for Simon, a self-employed IT consultant. Barclays Insurance (Dublin) advised him to register for unemployement benefit and make a claim.
Simon made his claim in October, but when he'd heard nothing by December, he contacted Barclays Insurance. It said it had not received his application. So he submitted a new one.
Barclays Insurance insisted on contacting Simon's accountant to confirm details of his claim. Simon explained that this would cause a delay as his accountant was no longer acting for him. It wrote anyway, and in mid-January the accountant confirmed this. Barclays then wrote to Simon asking for details of his tax office. Simon says he didn't get this letter, and continued to wait for Barclays to process his claim.
After sending this one letter to Simon, Barclays Insurance apparently made no effort to contact him again. But Barclays Mortgages were more active. In March it made a formal demand for his arrears and threatened to re-possess his home. By now Simon's asthma had worsened due to the stress of the case
Luckily, Simon had now found another job and could hire a solicitor. The solicitor asked Barclays Mortgages to delay taking legal action while the claim was being processed, and pointed out that payments would re-commence in April because Simon was now working. This didn't stop Barclays Mortgages, who referred Simon to credit reference agencies and began court action in early April.
The day after Simon received notice of the court action, Barclays Insurace agreed to pay his claim. Under pressure from Simon's solicitor the bank reluctantly agreed to drop the action.
Simon now faces solicitor's bills of more than £2,000, penalties for missing payments to other creditors - payments he always thought would be covered by his insurance - the bill for Barclays Mortgages legal action, and a ruined credit record.
Simon complained to Barclays in September and asked for compensation. Barclays apologiesd but said the delays were unavoidable. It added that some of the original settlement had been a goodwill payment and so it felt that it had paid 'adequate recompense' already.
Which? asked Barclays whether this case was a good example of its approach to customer care. It denied it had done anything wrong, and said it had 'acted fairly' and communicated adequately with the client to resolve the problems. It has now asked Simon to quantify his solicitor's bills so it could further consider his claim for compensation.
Simon is taking his complaint to the Financial Ombudsman. We'll keep you posted.
There's a few small inaccuracies - I'm not self employed anymore, for instance - but the essence of the tale is regrettably accurate.