Fidrec's jurisdiction increased to $100,000
The limit for non-insurance related adjudicated claims will be lifted from $50,000 to $100,000 from Jan 3, a move long demanded by market watchers.
The Financial Industry Disputes Resolution Centre (Fidrec) said the change will give more consumers access to an affordable dispute resolution process.
This also brings it in line with insurance-related adjudication claims, where the limit is already $100,000.
Before the revision announced yesterday, people with claims over $50,000 would often have had to seek legal action, a more expensive option.
There is in fact no limit for disputes resolved by mediation. This would involve Fidrec mediating a solution between the parties, even where the claim amounts are above the current adjudication limits.
Filing a complaint at Fidrec is free but if mediation fails, you will be charged $50 a claim if your case proceeds to adjudication.
Non-insurance related claims are disputes between consumers and banks, finance companies, capital markets intermediaries, financial advisers or insurance intermediaries. Third party claims can also be lodged.
It is not clear why there is an inconsistency in dispute limits for banks and insurers in the first place. The rising number of tie-ups between banks and insurers and the expanded market share of life insurance sales via banking channels means it makes sense for banks to have the same limit as insurers.
Fidrec initiated a review of its jurisdiction last year but it did not address another area of inconsistency - the dispute cap for non-injury motor accidents.
This is $3,000 and deemed too low by industry practitioners and the consumer watchdog due to the increasing repair costs for cars.
The Consumers Association of Singapore had asked Fidrec to consider reviewing the claim limits for insurance, banking and motor accident disputes. There are also calls for Fidrec to step up its disclosure on disputes to raise consumer education.
Fidrec told The Straits Times yesterday: "The claim threshold value of $3,000 may be further reviewed, as appropriate."
People who lodged non-insurance claims before Jan 3, 2017, and where the grounds of decision have not been read, can raise the amount to $100,000.
Mr Goh Joon Seng, Fidrec's chairman, noted it was timely for Fidrec to initiate a review of its jurisdiction limit in conjunction with its 10th anniversary last year.
"The increase in jurisdiction limit will allow Fidrec to help more consumers and the financial industry reach an amicable and mutually acceptable resolution in the event of disputes."