Not upheld: claim settlement dispute and service failures complaint against UIA (Insurance) Limited

Decision detail

Summary

Mr W claimed on his home insurance following a burglary in October 2017 where windows were broken. Without waiting for UIA's authorization, he arranged for windows to be replaced at a cost of £4,900, approximately five times UIA's estimated cost. UIA offered settlement based on their own contractor rates in April 2018. After five years of no contact, Mr W queried the settlement in December 2023 and complained. UIA partially upheld the complaint, offering £250 for poor communication. The ombudsman found UIA's settlement fair because Mr W's unauthorized actions prejudiced their position and he paid inflated rates to a contractor later convicted of trading standards breaches. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Mr W's actions in proceeding with the window replacement without UIA's authorization prejudiced UIA's position and ability to manage the claim. While sympathizing with Mr W's sense of urgency following the burglary, the insurance contract required approval before incurring costs. UIA's settlement based on their own contractor costs was fair and reasonable, particularly given the evidence that Mr W paid significantly above market rates to a contractor later found guilty of trading standards breaches. The passage of five years between the claim event and complaint, combined with Mr W's failure to provide persuasive evidence that his costs were competitive, meant the settlement offer was appropriate. The £250 compensation for service failures was proportionate to the impact caused by UIA rather than by the inflated repair costs.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website