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Homeserve hit with fine of £34.5m

Home repair and insurance group Homeserve has received a £34.5 million fine by the City regulator for a mis-selling scandal.

The Walsall-based firm had previously set aside only £6m to meet a penalty by the Financial Conduct Authority (FCA).

It has been under a cloud since first revealing problems with its sales practices in October 2011.

The FCA probe looked into mis-selling of household emergency policies and poor handling of customer complaints by the company, whose products include boiler and central heating breakdown cover and insurance against blocked drains.

The scandal has already seen Homeserve fined £750,000 by regulator Ofcom in 2012 for silent and abandoned calls.

Homeserve said it was now setting aside £36m to cover the FCA fine and associated costs, which are in addition to the £40m already put by to cover compensation for customers.

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