Not upheld: Service failures generally complaint against Esure Services Limited

Decision detail

Summary

Mr R complained that ESL charged an unreasonable £60 cancellation fee when he cancelled his motor insurance policy in July 2024. ESL initially informed him of the fee but waived it during the cancellation process after Mr R contested it. The ombudsman found that ESL had clearly disclosed the £60 fee in the policy terms and welcome letter when Mr R took out the policy in October 2023, and the fee was reasonable compared to other insurers. Since the fee was ultimately waived and Mr R received a refund of remaining premiums, he suffered no financial impact. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that ESL had clearly disclosed the £60 cancellation fee in both the welcome letter and the policy agreement before Mr R took out the policy. The fee was charged in accordance with the stated terms and was reasonable when compared to cancellation fees charged by other insurers. Critically, the fee was waived by ESL during the cancellation process, so Mr R suffered no actual financial impact. The ombudsman noted that the FOS does not have the power to dictate how businesses operate or set specific charges, only to assess whether terms have been followed and charges fairly applied. Since the fee was waived, there was no unfair treatment of Mr R.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website