All this is set to change. In the wake of the publication of the Government's draft regulatory reform Bill, on 30 July, the full integration of financial services is on the horizon. The Financial Services and Markets Bill sets the framework for a single ombudsman scheme and will finally put an end to the proliferation of consumer protection bodies (see box for a full list of where to complain now).
The Bill is unlikely to become law until late next year, so in the meantime customers still have to struggle to make contact with the right scheme. Worse, membership of some of the schemes, such as the Insurance Ombudsman Bureau, is voluntary.
Most of the trade bodies stipulate that the person complaining must have exhausted the firm's internal complaints mechanisms and given the senior management a chance to examine the complaint. But this is where the similarities between the eight schemes end.
Given that there is a considerable degree of overlap between, for example, the Banking Ombudsman and the Building Societies Ombudsman, it is even more puzzling to find that each scheme has its own set of rules.
The Banking Ombudsman gives the injured party six months to refer the grievance to its office, while the Building Societies' scheme allows a society six weeks to resolve a dispute through its internal complaints procedure.
There has been criticism that some organisations keep such a low profile that customers simply do not know they exist. For example, the Personal Insurance Arbitration Service (PIAS) counts the Co-operative Insurance Society (CIS), the medical insurer Bupa, Exeter Friendly Society, health insurer BCWA and, until recently, PPP healthcare among its members.
PPP has now joined the Insurance Ombudsman in light of its merger with the insurer Guardian Royal Exchange. But before the merger, the PIAS was representing about 75 per cent of the private health insurance market. Michael Lovegrove, a spokesman for the Insurance Ombudsman's office, which represents the remainder of the medical insurance companies, comments: "Last year the Insurance Ombudsman office dealt with 113 disputes relating to medical expenses, while the PIAS dealt with six. From our experience we would expect the PIAS to be listening to between 300 and 400 cases a year. We would like to know what has happened to those policyholders."
All these variations between eligibility criteria, limits on awards, procedures, compulsory and voluntary memberships, and public awareness make it difficult for us to weigh up whether we are getting the best advice and help.
The Government has decided that its new, mandatory complaints-handling regime should be based on an ombudsman approach rather than on arbitration. It has also stated that membership of the new ombudsman scheme - likely to be called the Financial Services Ombudsman Scheme - should be compulsory for firms that are authorised by the Financial Services Authority. The chief Ombudsman and panel of Ombudsmen will be appointed in March 1999.
The move to create what is being dubbed a "superbody" has been welcomed across the board. Tony Holland, principal Ombudsman for the PIA Ombudsman bureau, says the new scheme will be better for the consumer and the financial services industry: "In the long term, it will be a more focused body of decision-making processes."
But Walter Merricks, the Insurance Ombudsman, voices concern about the hazards in having a "one-stop shop" for disputes: "There is a danger in large schemes that they can become bureaucratic - and it is one that all the insurance ombudsmen have pointed to - and also that the legal framework might require it to become more legalistic than our schemes are at the moment."
The policy statement released by the FSA last month goes some way to allaying industry fears. It states: "We believe that it should be possible to ensure that the great majority of cases continue to be resolved through the informal procedures which are the hallmarks of existing schemes."
Philip Telford, senior policy researcher at the Consumers' Association, says the association supports the new scheme. However, he cautions that changing the structure will not solve anything. "It is the way in which the body operates that is important," he says. "We will be looking for a consistent approach with things like the levels of awards made and the turnaround of complaints in the new body."
For more information the FSA website is http://www.fsa.gov.uk
Helen Nugent is assistant editor of 'Health Insurance' magazine.
where to go with a complaint
All the schemes listed below will be replaced by the single FSA Ombudsman, probably towards the end of 1999. In the meantime you can call the FSA Helpline 0845 6061234 if you are confused about where to go for help.
Banking Ombudsman, 0171-404 9944. Resolves complaints against banks in the UK. Can award compensation up to pounds 100,000. The bank has to accept its decision; complainants who are not satisfied retain the right to go to court. In the year ended 30 September 1997 it received 26,561 calls and 8,818 written complaints.
Building Societies Ombudsman, 0171-931 0044. About 70 members. Can help you if you think a building society has infringed your legal rights, treated you unfairly, been guilty of inefficiency or administrative failures, or made an unsound commercial decision, as a result of which you have lost money.
FSA Direct Regulation Unit, 0171-676 1000. Deals with cases against the special regulatory organisations, which used to be regulated by SIB (PIA, Imro, SFA) and are now under the FSA.
Insurance Ombudsman Bureau, 0171-928 4488. Over 300 members. Received 67,601 enquiries in 1997. Just over half were about matters excluded from its remit. More than 10,000 were complaints about insurance intermediaries or brokers, who are not covered. (These firms are in "limbo" at the moment as the Insurance Brokers Registration Council is about to close. However, there is a special unit at PriceWaterhouseCoopers monitoring them.)
Investment Ombudsman, 0171-769 3065. Deals with complaints relating to investment business against firms regulated by the Investment Management Regulatory Organisation (Imro).That includes most unit trust and PEP providers. Claims for financial loss are normally limited to a maximum of pounds 100,000, and claims for distress and inconvenience to a maximum of pounds 750. Received 299 complaints between 1 April 1997 and 31 March 1998.
Personal Insurance Arbitration Service, 0171-837 4483. Has 17 members, including some medical insurers. Can award pounds 100,000. Awards legally binding on insurers but not on consumers.
PIA Ombudsman, 0171-538 8860. About 4,000 member firms. All firms authorised by the Personal Investment Authority have to submit to its rulings. Covers everything from endowments and personal pensions to unit trusts. Can award a maximum of pounds 100,000.
SFA Complaints and Arbitration Services, 0171-378 9000. The Securities and Futures Authority regulates firms involved in the securities and futures sectors of the financial services industry. Around 1,330 firms come under its supervision. Operates an arbitration service requiring a pounds 50 registration fee.