More Insurance Miss-Selling Accusations
The BBC have been putting UK recruitment agencies under fire recently, accusing them of selling personal accident insurance policies to their temporary workers. Here in the UK we are no strangers to insurance miss-selling, with miss-sold PPI and credit card insurance being all over the news in recent times. An investigation has revealed that recruitment agencies have been convincing many temporary workers to purchase these personal insurance policies even though they are unnecessary because employers are required, by law, to have employers’ liability insurance.
The temporary workers in question have been pressured into purchasing these redundant insurance policies according to recruitment agency staff member Alison. She said: “The agency was asking for high percentages, maybe 80% or 90% of people, to be on the scheme. We would check payroll and see whether there was anybody who wasn’t and give them a ring to come in so we could double check whether they wanted the insurance policy or not.”
The Trades Union Congress’ (TUC) policy director Sarah Veale said: “You can have too much insurance especially if it is duplicating the employers’ liability insurance which employers have to take out by law. To get the employee to insure themselves as well is just completely and absolutely unnecessary, it’s a rip off.” The Financial Conduct Authority (FCA) has stated that it is going to review the recruitment agencies to see whether they are selling these insurance policies as a business and if they should be regulated as such.
Simon Green, the FCA’s head of insurance, said: “Generally speaking, only firms who are authorised by the FCA should be doing regulated business. Selling a range of insurance is a regulated activity. One of the things we will be looking into will be the role the agencies have been playing in this and whether that actually constitutes as regulated activity.”
The BBC argued against the recruitment agencies, saying that the workers who are purchasing these insurance policies from them don’t speak English, accusing the agencies of “scheming off easy money from people”. According to the BBC, these personal accident insurance policies cost less than £1 per week and are being sold on for between £2.50 and £3 a week.
James Savery, 27 September 2013