Speed up or else, insurers warned

LIFE insurers that drag their feet over the handling of endowment mis-selling complaints have been warned - shape up or pay up.

The Financial Services Authority says it is losing patience with the industry over its slow handling of the mortgage mis-selling scandal.

The watchdog's warning follows Friday's announcement that it has fined Allied Dunbar, part of Zurich Financial Services, £725,000 for not doing enough to sort out endowment complaints from unhappy customers.

It also comes in the wake of a critical report from the Treasury Select Committee, which said more needed to be done by the industry to speed up its complaints process.

This is the second fine in three months that the FSA has levied on insurers that have failed to clear up the mess caused by mis-selling endowments. Just before Christmas, Friends Provident was fined £675,000.

'We are losing patience and have told firms lagging behind that they must speed up their complaints handling system,' the FSA said. 'We have our eye on a number of companies.'

Last month, the Financial Mail on Sunday revealed that Zurich was one of four companies warned by the FSA that they faced huge fines.

The others - HBoS, Legal & General and Norwich Union -know that from the end of April, complaints will have to be handled in eight weeks or they will face a similar fate to Zurich.