Not upheld: premium calculation and pricing for policy upgrade complaint against Aviva

Decision detail

Summary

Mr and Mrs W complained to Aviva about how it calculated the premium for a trip duration extension upgrade under their travel insurance policy. Their policy covered trips up to 31 days, but they were travelling for longer and Aviva quoted for the entire trip rather than just the additional days. The ombudsman upheld Aviva's position, finding that insurers are entitled to decide upgrade pricing as long as they treat customers consistently, and that the policy terms do not require explanation of the pricing methodology used.

The Ombudsman's reasoning

The ombudsman determined that Aviva is entitled to decide the basis and price on which it offers upgrades, provided it treats customers in the same situation consistently. The policy terms do not require explanation of how risk and price are calculated for upgrades. Aviva demonstrated it would price any upgrade quote in the same way as Mr and Mrs W's quote, meaning they were treated the same as any other policyholder. The FOS cannot interfere with an insurer's commercial practices including underwriting risk and pricing.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website