Upheld: mis-selling - failure to disclose material policy exclusions before sale complaint against British Gas Insurance Limited
Financial Ombudsman decision DRN-5975961 of 2026-04-13T00:00:00+00:00. mis-selling - failure to disclose material policy exclusions before sale complaint against British Gas Insurance Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-5975961 |
|---|---|
| Decision date | 2026-04-13T00:00:00+00:00 |
| Firm | British Gas Insurance Limited |
| Product | Other regulated product |
| Claim type | mis-selling - failure to disclose material policy exclusions before sale |
| Outcome | Upheld |
| Remedy | Refund the difference between premiums paid for HomeCare 3 policy and the cheaper policy that would not have covered central heating, plus simple interest at 8% from the date each premium was paid to the date of settlement. |
Summary
Mrs P purchased a HomeCare 3 home emergency policy from British Gas in 2022 covering central heating, but her apartment has underfloor heating which was excluded from cover. She was not made aware of this exclusion before purchase, only discovering it during the third boiler service in 2025. British Gas argued the exclusion was in the terms and conditions sent after inception and claimed an engineer had informed her in 2022, but the ombudsman found the firm failed to comply with ICOBS rules by not ensuring she was aware of main policy exclusions before sale. The ombudsman upheld the complaint and ordered refund of overpayments plus interest.
The Ombudsman's reasoning
British Gas failed to comply with ICOBS rules by not ensuring Mrs P was aware of main policy benefits and exclusions before purchase. The fact that British Gas noted Mrs P had no radiators during the sale should have triggered a query about her central heating system type. The underfloor heating exclusion was not adequately highlighted in the IPID and was only discovered by Mrs P at the third service, indicating she was not properly informed at point of sale. The information about cover was not presented fairly or transparently.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| British Gas Insurance Limited, all decisions | 1,874 | 41% |
| Other regulated product, all decisions | 52,408 | 30% |
Source
Read the original decision on the Financial Ombudsman Service website