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Law360, London (August 26, 2020, 12:07 PM BST ) Britain's financial dispute resolution body said Wednesday it has received 3,500 complaints linked to the COVID-19 crisis in three months as consumers report being unhappy with the way they have been treated by financial services companies during the pandemic.
The Financial Ombudsman Service, the body that resolves complaints about finance firms, said that almost a quarter of the total claims came from individuals whose travel plans were thwarted by the lockdown imposed to deal with the pandemic and were denied cover by their insurers.
The agency said it has received more complaints from small businesses so far in 2020 than in the whole of 2019. The claims, made in the three months from April to June, are mostly about insurance claims for business interruption and complaints about the coronavirus loan schemes.
"COVID-19 has had a huge impact on virtually all elements of our lives, including our finances," Caroline Wayman, chief ombudsman and chief executive of the Financial Ombudsman Service, said.
"Since measures to control the virus in the U.K. were put in place, we've been hearing from people who aren't happy with how their financial provider has treated them," she added.
The ombudsman added that some financial services companies have adapted well to the crisis but that others can improve. Some businesses themselves are struggling to deal with complaints because of the scale of the crisis.
The dispute resolution body said that 200 of the complaints were made by consumers who wanted money refunded by their credit provider for canceled holidays, sporting events and concerts.
The data also showed an increase in the number of complaints from consumers who had to cancel weddings and wanted their money back, as well as complaints about companies taking too long to deal with their claims.
The Pensions Ombudsman said in July it expects a similar surge in complaints about pension payments as a result of the pandemic.
Ombudsman Anthony Arter told the parliamentary Work and Pensions Committee on Wednesday that there will probably be complaints about employers failing to pay pensions contributions or about fraudsters encouraging people to withdraw their long-term savings.
Business interruption insurance has been a source of conflict since the COVID-19 crisis set in.
The Financial Conduct Authority is taking insurers to court to establish whether they should be forced to compensate companies for losses caused by COVID-19 under business interruption policies.
The trial, taking place under the financial markets test case scheme, could decide whether insurers pay out on claims to an estimated 370,000 businesses forced to close during the national lockdown, which began in March.
--Additional reporting by Martin Croucher. Editing by Ed Harris.
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