How to Write a Good Final Response Letter

Receiving a complaint can be a stressful and worrying time for a firm; here we share our top ten tips on how to approach, respond and hopefully resolve the complaint.? The rules governing a firm’s complaints handling and final response requirements are set out in the Financial Conduct Authority’s DISP rules (‘the DISP rules’)

Top Ten Tips:

1. Acknowledge & set out your understanding of the complaint

DISP 1.6.1 requires you to send a written acknowledgment to the client confirming receipt of their complaint and advising that this is being dealt with. This should confirm your understanding of their complaint and the timescales for your response.

2. Keep to timescales

Where possible, responding to a client quicker than the 8 weeks set out in the DISP rules can show you are dealing with their complaint proactively and will hopefully help maintain a good relationship meaning they may be more accepting of the final response. If it becomes apparent that your investigation and response will take over 8 weeks, keep the client updated.

3. Set out the background

It is good practice to set out, in the first part of the Final Response Letter (‘FRL’), the key details. This is particularly useful when the complaint relates to events that took place (potentially) several years ago. A good rule of thumb is that you should be able to read an FRL without knowing the file and be able to understand the complaint, the advice it relates to, and the decision.

4. Consider whether the complaint is brought within time

Under the DISP rules a complaint will be outside of the Financial Ombudsman Service’s (‘FOS’) jurisdiction and can be time-barred where: (i) the advice and/or (in)action the client is complaining about happened more than six years ago; and (ii) where the client’s complaint is made more than three years after they realised (or should have realised) that there was a problem.

5.? Review the FOS’ jurisdiction

In addition to time-barring rules, there are numerous other factors that can take a complaint outside of the FOS’ remit. Common jurisdiction issues include:

• Whether the complainant is “eligible” i.e. a consumer, a micro-enterprise, a charity, a trustee of a trust or a small business (subject to the size of business and income requirements).
• Whether the advice was “regulated” at the time it was given - different products and types of advice became regulated at different times and dates. The FOS cannot look at advice given prior to an area or product becoming regulated.

6. Use your file

Where possible you should refer to contemporaneous documents that you have in your file, such as suitability reports, fact finds and Attitude to Risk forms. You should include key extracts from these in your FRL where relevant but avoid copying and pasting large chunks which may make any response harder to follow. It is also useful to provide copies of the full documents with the response so these can be reviewed in full.

7. Consider the alternatives

While causation is a legal term and can seem daunting and complex to assess, it is always worth considering what would have happened if the alleged negligence had not taken place. This usually involves considering what the client or a third party would have done i.e. would the client have transferred to a particular fund irrespective of the advice received; or would an insurance provider’s decision to write a policy have been impacted if accurate information had been provided.

8. Explain your decision

While this may seem an obvious point, we often see FRLs where a firm has referred to all the relevant information from their file but not actually linked this to the complaint outcome. It must be remembered that the complainant may not have a particularly sophisticated understanding of financial matters and you should always explain how you have come to your decision without using technical jargon. FRLs should be structured using short sentences and headings in an order that has considered what a customer is most interested in e.g. with a “Decision” provided early in the letter. Information should be layered so a customer can understand it. Consider using questions as headings and/or use bold text to make sections stand out and break up large volumes of text.

9. Take out the emotion

While it is entirely understandable that a complaint can feel personal and unreasonable, your response should remain neutral and factual. While it can be tempting to vent any frustrations at the complainant in the FRL this is unlikely to be of any benefit.

10. FOS wording

It is imperative that the FOS’ wording is included in the FRL. DISP 1.6.2 sets out that in order to be valid the FOS wording must; (i) provide the website address for the FOS; (ii) enclose a copy of the FOS explanatory leaflet; (iii) confirm that the complainant can refer the complaint to the FOS if they remain dissatisfied; and (iv) confirm if the respondent consents to waive the relevant time limits relating to the timescales for referral to the FOS; appropriate wording is set out in DISP Annex 3R.

In addition to these tips, we recommend that you tell your insurer about any complaint received as early as possible. While the purpose of this article is not to go into the details of the policy cover and what should be notified, it is always best, and often a condition of your policy, to notify your insurer or broker when a complaint is received.

Your insurer or their claims handling representative deals with these types of complaints on a regular basis. Receiving complaints can be a daunting and stressful time and they will be able to support you throughout the process, assisting you with your FRL and answering any queries you may have.

This article was written by Charlotte Mayor & Alex?at Collegiate Claims?with contribution from Hannah Smedley & Jenny Jeapes at Liberty Specialty Markets.

This note is produced for information purposes only and is not to be relied upon or construed as legal advice.