Not upheld: policy cancellation for non-payment of premium complaint against Laka Limited

Decision detail

Summary

Mr H complained about Laka's cancellation of his bicycle insurance policy due to non-payment of the May 2025 premium. Laka attempted to collect payment on 3 May 2025, failed, and contacted Mr H multiple times throughout May before providing 14 days' notice and cancelling the policy on 31 May 2025. Mr H made payment on 31 May 2025 (after cancellation) and later on 2 June 2025, but this was after the 7th business day deadline specified in the policy terms for retrospective reactivation. Laka instructed Mr H to reactivate the policy himself, but Mr H did not do so or contact Laka for help before attempting to claim on 6 August 2025. The ombudsman found Laka acted fairly and reasonably in accordance with the policy terms and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that Laka complied with the policy terms by providing 14 days' notice before cancellation and that the cancellation occurred before Mr H made payment. Although Laka received payment on 31 May 2025, this was after the 7th business day threshold specified in the policy terms for retrospective reactivation. After cancellation, Laka provided clear instructions for Mr H to reactivate the policy himself, but Mr H did not attempt to do so or contact Laka for assistance between June and August 2025. The ombudsman concluded Laka acted fairly and reasonably throughout.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website