Upheld: Other regulated complaint complaint against WDP Insurance Limited

Decision detail

Summary

Ms D complained to WDP Insurance Limited about the £125 excess on her mobile phone insurance claim in August 2023, which she did not pursue as it was close to the phone's replacement value. She argued the excess should have been reduced as her phone aged, citing policy terms suggesting excess would reduce with device depreciation. The ombudsman found WDP was on risk and had reasonable grounds for not reducing the excess, as the refurbished device value exceeded the excess amount. However, the ombudsman upheld the complaint because the policy terms regarding discretionary excess reduction were potentially misleading, and ordered WDP to pay £50 compensation for the distress caused.

The Ombudsman's reasoning

The ombudsman found that WDP was on risk during the period of cover as the value of the refurbished device would have been significantly more than the £125 excess. While the policy gave WDP discretion to reduce the excess, the ombudsman expected the insurer to explain the reasons for exercising that discretion. WDP provided reasonable grounds for not reducing the excess (that the device value exceeded the excess, so the consumer was not receiving poor value). However, the ombudsman found the policy information could have been clearer about the basis for exercising discretion, and the £50 payment was appropriate to recognise the upset caused by the misleading policy term.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website