The Financial Conduct Authority (FCA) has issued its biggest ever retail fine of £31 million, to insurance company HomeServe.
The FCA found that HomeServe had 'serious, systemic and long running' failings during January 2005 to October 2011. These included mis-selling insurance policies, failing to investigate complaints adequately and the senior management being reluctant to address risks to customers if there was a cost implication involved.
HomeServe, who sells home emergency and repairs insurance cover has paid approximately £12.9 million in redress to affected customers and is expected to pay a total of £16.8 million.
The company originally faced a £44 million fine but received a discount for settling at an early stage.
Reports published last month suggested HomeServe faced a £34.5 million fine but the FCA confirmed the fine totalled £30,647,400.
The FCA said HomeServe had developed a 'profit driven culture' where profit targets were met by 'taking advantage' of customers.
Tracey McDermott (pictured), director of enforcement and financial crime at the FCA said the serious nature of the case warranted the regulator's largest retail conduct fine.
'HomeServe is another example of a firm that has acted without proper regard for its customers over a long period of time. HomeServe promises to provide customers with peace of mind when things go wrong. In fact the firm’s culture, controls and remuneration structures meant that staff were focused on quantity not quality and there were customers that paid the price for that.'