The Financial Services Compensation Scheme (FSCS) has launched an in-house data lake tool to enhance the efficiency with which it can assess claims, helping to speed up the process for consumers as it expects pension advice and SIPP failures to take up more of its resources.
A data lake is a system of stored data that has no structure. Therefore, the FSCS said, its Resolution Data Lake tool will mean it will no longer have to manually assess every single page or document in a customer's file.
The tool searches through the data and highlights keywords within the documents, flagging where they appear. The FSCS claim handlers then review those pages to make sure the findings are accurate.
So far, the FSCS said it is seeing not only a reduction in the manual handling time for each claim, but also larger reductions in the overall time a customer waits for a decision.
"As well as improving the customer experience, it's helping us prepare for future failures," the lifeboat fund said. "At a time when things are more uncertain than ever, it's giving us even more confidence in our ability to handle large, and sometimes unexpected, volumes of claims data at once.
"It's also allowing us to begin to proactively analyse and assess the entire data set from a failed firm, without even needing to involve individual customers. This means, for some firms, customers may not even need to make a claim."
When a firm goes out of business, the FSCS often receives more than 1,000 pages of documentation for each customer, it said, particularly in relation to self-invested personal pension (SIPP) operators.
Over the coming year, it expects the rise in complex pension advice claims to continue and more self-invested personal pension (SIPP) operators to fail.
In January, it was revealed that collapsed SIPP provider Liberty SIPP received 1,696 claims against it, according to the lifeboat fund. Liberty SIPP failed after going into administration in April last year following a number of high-risk non-standard investment claims against it.
Then, at the start of April, the Court of Appeal voted in favour of Russell Adams and against his SIPP operator Options Personal Pensions, formerly Carey Pensions, in their long-running legal dispute. In July 2012, Adams invested £50,000 into Store First unit pods. Over the years, the funds have depleted and are now virtually worthless.
First published by our sister title Professional Adviser
