Insurance complaints have risen as small businesses struggle in a tough economic climate, according to New Zealand’s independent dispute resolution service.

Financial Services Complaints received 1469 cases in the year to June 30, up from 1426 a year earlier and double the total recorded five years ago.

Of the 366 that were formally investigated, complaints about financial advisers including insurance brokers made up the largest proportion at 23%, followed by lenders at 20% and insurers at 17%.

Data provided to insuranceNEWS.com.au shows FSC investigated 63 disputes involving insurers during the period – up from 52 the previous year and 39 in FY23.

A spokesperson says not all complaints about insurers are upheld and many “result from a client’s dissatisfaction when their claim is declined”.

FSC investigated 32 complaints against insurance brokers, up from 27 and 17 in the previous two years.

The spokesperson says many of these cases stem from poor communication.

“Examples include failing to pass on important information, failing to explain the extent and limits of cover, and not taking the time to fully understand the client’s business and insurance needs and specific requirements. This is particularly the case in small business complaints.”

FSC notes a rise in complaints from small businesses, especially about loans and insurance products.

“This likely reflects the tough trading environment many small business owners are facing,” ombudsman Susan Taylor said.

“They’re under pressure and we’re seeing that come through in the disputes they bring to us.”