Upheld: Motor insurance, claim handling complaint against Esure Services Limited

Decision detail

Summary

Mr B complained that esure failed to correctly update his motor insurance policy when he changed cars, leaving him uninsured for approximately seven months without his knowledge. When DVLA notified him of a fine for being uninsured, esure admitted their mistake and apologised. Mr B sought compensation for the stress, the unexpected higher premium he was forced to accept, and a full refund of premiums paid during the uninsured period. The ombudsman upheld the complaint but found esure's offer of a £50 fine reimbursement, £77.30 fee refund, £200 compensation, and a letter of indemnity to be fair, as the premium increase was justified by the new car being larger and more expensive, and esure resolved the situation quickly.

The Ombudsman's reasoning

The ombudsman found esure's settlement offer fair because: (1) the new car was larger and more expensive, so a premium increase was expected regardless of insurer; (2) no persuasive evidence showed Mr B could have obtained a cheaper premium elsewhere; (3) esure provided a letter of indemnity covering the uninsured period, effectively insuring retrospectively; (4) Mr B's policy documentation clearly warned him to check information was correct, and esure demonstrated the communications were sent; (5) esure resolved the situation quickly on the day Mr B discovered the problem; (6) the £200 compensation fairly reflected the stress and inconvenience given the swift resolution and that no adverse event occurred during the uninsured period.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website