Partially upheld: Complaints handling failures complaint against Principal Insurance Limited

Decision detail

Summary

Mr G complained on behalf of his late father's estate about an insurance policy sold by PIL after the father's death, which was obtained through identity impersonation. While the ombudsman found PIL did not act wrongly in selling the policy online without identity verification, as there is no regulatory requirement to do so, PIL failed to respond promptly to the estate's complaint made in April 2018. This failure to communicate left Mr G unaware of PIL's actions to cancel the policy, forcing him to contact fraud agencies and the FOS, incurring £50 in costs. The complaint was partially upheld, and PIL was ordered to refund the £50 in costs incurred by the estate.

The Ombudsman's reasoning

The ombudsman found that PIL did not act wrongly in selling the policy online without verifying the applicant's identity, as there is no regulatory responsibility for brokers or insurers to validate applicant details prior to issuing a policy, and many only verify information after a claim is made. However, PIL failed in its complaints handling obligations by not responding promptly to the estate's complaint in April 2018. This failure to communicate left Mr G unaware of the action PIL had taken to cancel the policy, forcing him to take additional steps to protect the estate's interests, including contacting a fraud agency and the FOS, which resulted in costs of £50 that could have been avoided with prompt communication.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website