Financial services organisations are equipped with greater expertise and resources available for designing, distributing, and servicing financial products,than consumers have available to them in making decisions about transacting with such entities. For this reason, Treating Customers Fairly (TCF) regulation has been implemented to protect consumers from unfair practices.
The principles-based approach of TCF requires that organisations consider, not just the letter of the law and contractual agreements but place emphasis on the spirit of an agreement with a consumer. Fairness was at the heart of the Momentum case in November 2018, where the insurer faced a challenge in addressing spiralling public sentiment in response to a legal decision to a reject a policy holders claim based on non-disclosure.
Following news that Momentum would deny the claim, a number of influential public figures and journalists, took Momentum to task on both broadcast and social media. The viral spread of this news – particularly on social platforms like Twitter - triggered public outrage. Momentum’s initial reasoning not to pay out due to non-disclosure of high blood sugar provoked a public outcry and caused immense reputational damage to the insurer despite the long-term insurance ombudsman finding in favour of their decision. The substantial increase in the online public conversation on the matter and the weight many media outlets gave to social media’s role in the story led BrandsEye to conduct an exploratory sentiment analysis of online conversation.
The analysis of conversation, from 14 - 22 November, sheds light on the influence of online consumer activism, assesses the reputational damage that the incident caused Momentum, and quantifies the extent to which they might have lost existing and prospective clients due to the incident.