Not upheld: policy administration error and service failure complaint against The Prudential Assurance Company Limited

Decision detail

Summary

Mr and Mrs M complained to Prudential about a significant unexplained reduction in their whole of life policy's sum assured. Prudential acknowledged system issues from a 2019 migration had caused the overstatement but took from April 2024 to November 2025 to fully resolve the matter, during which they failed to respond to multiple chasers from Mr and Mrs M's representative. Prudential paid £1,350 in total compensation and the investigator found this fair, but Mr and Mrs M's representative argued it was insufficient given their age, the distress caused, and the length of time taken. The ombudsman upheld the investigator's view, determining that £1,350 was appropriate compensation under FOS guidance and declining to order additional payments or reimbursement of legal fees.

The Ombudsman's reasoning

The ombudsman acknowledged that Prudential made a clear error and provided substandard service over a prolonged period. However, applying FOS compensation guidance, the ombudsman determined that £1,350 fell within the appropriate range (£750-£1,500) for substantial distress over a sustained period. The ombudsman found that while Mr and Mrs M experienced significant inconvenience, they did not suffer the level of sustained distress, severe disruption, or extremely serious short-term impact that would justify higher compensation. Regarding legal fees, the ombudsman noted that Mr and Mrs M could have escalated to FOS after the August 2024 response without incurring fees, and they had been able to correspond with Prudential independently before instructing a representative.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website