Partially upheld: Motor insurance, claim handling complaint against Liberty Mutual Insurance Europe SE

Decision detail

Summary

W, a financial advisory firm in liquidation, complained that Liberty Mutual refused to acknowledge a valid circumstance notification regarding pension transfer advice found unsuitable by the FCA. W had notified Liberty Mutual of identified clients likely to make claims. Liberty Mutual disputed the notification's validity and applied exclusions for B Scheme and N Scheme transfers. The ombudsman found the notification valid as it identified specific clients from whom claims were likely, and interpreted the N Scheme exclusion's 'per annum' term as 'financial year' based on how the parties discussed the risk at renewal. The ombudsman upheld the complaint in part, directing Liberty Mutual to deal with claims not caught by the two exclusions in accordance with policy terms.

The Ombudsman's reasoning

The ombudsman found the notification valid because W provided a specific list of identified clients from whom claims were likely following the FCA's finding that advice was unsuitable. The ombudsman interpreted 'per annum' in the N Scheme exclusion as 'financial year' based on the parties' intentions at renewal, when W presented figures on a financial year basis and Liberty Mutual proceeded accordingly. The B Scheme exclusion was accepted by both parties. The ombudsman rejected Liberty Mutual's argument that regulatory investigation alone negates a circumstance notification, distinguishing between general regulatory concerns and specific investigations into advice to identified clients.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website