Not upheld: insurance broker service failure; alleged failure to update risk address; alleged failure to advise on disclosure obligations; alleged failure to advocate on customer's behalf complaint against Advisory Insurance Brokers Limited (trading as MCM Insurance Services)

Decision detail

Summary

N, a limited company, complained to the FOS about Advisory Insurance Brokers Limited after its commercial insurance claim for a fire was refused and the policy voided. The insurer cited non-disclosure of previous incidents (another fire and theft) and unsatisfied CCJs against Mr K, the company director. Mr K claimed Advisory Insurance had verbally advised him that previous incidents without insurance claims did not need to be disclosed and that the firm failed to promptly update the risk address. The ombudsman found no reliable evidence that Mr K had disclosed these matters to Advisory Insurance before the quote was prepared, and that N had adequate opportunity to review the documents which clearly outlined disclosure requirements. Although Advisory Insurance failed to promptly update the address, the insurer's primary reason for voiding the policy was the non-disclosure of previous incidents and CCJs, not the address issue, so this failure did not affect the outcome. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the Insurance Act 2015 and FCA rules to assess whether Advisory Insurance breached its duties. The key finding was that there is no reliable evidence that Mr K disclosed the previous incidents or CCJs to Advisory Insurance before the quote was prepared. The Statement of Fact and quotation documents were provided to N with clear information about what needed to be disclosed, and N had the opportunity to review and query these before the policy start date but did not do so. While Advisory Insurance failed to promptly update the risk address, the insurer's primary reason for voiding the policy was the non-disclosure of previous incidents and CCJs, not the address issue. Therefore, the address delay did not cause any difference to N's position. The ombudsman concluded that Advisory Insurance conducted the arrangements appropriately and there is no reliable evidence it failed in its duties to act fairly and with due diligence.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website