Not upheld: Other regulated complaint complaint against Lexham Insurance Consultants Limited

Decision detail

Summary

Mr A, aged under 18, took out a motor insurance policy through Lexham and applied for monthly finance payments. The finance application was declined due to his age, and he was required to provide a guarantor or pay in full. Lexham sent two email notifications requesting action, but Mr A did not respond. Lexham then cancelled the policy with 7 days' notice by email as permitted by its terms of business. Mr A complained that Lexham should have used alternative contact methods such as phone or text. The ombudsman found that Lexham acted fairly by using email, which was Mr A's selected preferred contact method, and provided sufficient warning and notification of the cancellation in accordance with its terms of business and industry practice.

The Ombudsman's reasoning

The ombudsman considered whether Lexham acted fairly and in accordance with its terms of business. The terms permit cancellation with at least 7 days' notice by email. Lexham provided two warning emails before cancellation and a confirmation email after. Email was Mr A's preferred contact method as selected during the online application process. While good practice suggests using multiple communication methods for cancellations, this did not apply here because Mr A had explicitly selected email as his primary contact method and the cancellation notice would have been available on his online account. The ombudsman found that Mr A should have been reasonably aware he did not meet the loan requirements and had not provided correct guarantor details.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website