Upheld: Service failures generally complaint against Yoga Insurance Services Limited

Decision detail

Summary

Ms S called Yoga Insurance Services Limited to report a car insurance claim following an accident. Her call was transferred to E, an accident management company acting as Yoga's agent, which referred her to use credit hire and repair services without clearly explaining her options. Ms S was unaware she had stepped outside her regulated insurance contract. After repairs were completed, Ms S discovered issues with the work but could not complain to the FOS because she had not claimed on her insurance policy. The ombudsman upheld the complaint, finding that Yoga failed to meet its regulatory obligations under ICOBS to provide clear, fair and not misleading information about claim options, and ordered £100 compensation for the distress and inconvenience caused.

The Ombudsman's reasoning

Yoga appointed E to handle the claim call on its behalf, making E Yoga's agent. Although Yoga cannot be held directly responsible for E's actions as an AMC, Yoga retained regulatory responsibility for ensuring its obligations under ICOBS were met. The referral call recording showed E did not provide Ms S with enough information to make an informed choice about her repair options. This poor referral caused Ms S unnecessary distress and inconvenience, particularly as she was unaware she had stepped outside her regulated insurance contract and therefore could not complain to the FOS about the repair issues. The ombudsman was satisfied that £100 compensation was fair and reasonable for this impact, noting that even if Ms S had claimed on her policy, she may have faced similar repair issues since E also handles claims for her insurer.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website