Upheld: GAP / warranty insurance mis-selling complaint against MARSHALL MOTOR GROUP LIMITED

Decision detail

Summary

Ms B complained that Marshall Motor Group Limited mis-sold her a GAP insurance policy, claiming it did not offer fair value, that Marshall failed to provide a two-day deferred opt-in period, and that Marshall did not disclose commission. The ombudsman upheld the complaint only regarding the deferred opt-in breach, finding that while Ms B likely would have purchased the policy given her demonstrated need for cover, she was denied the opportunity to review key information independently for at least two clear days as required by ICOBS. The fair value complaint was rejected as the Consumer Duty does not apply retrospectively to 2022 sales, and the commission disclosure complaint was rejected as Marshall complied with ICOBS requirements by disclosing they 'may' receive commission. Marshall was ordered to pay £100 compensation for the loss of opportunity.

The Ombudsman's reasoning

The ombudsman upheld the complaint on the basis that Marshall breached ICOBS 6A.1.4R and ICOBS 6A.1.6R by failing to provide Ms B with at least two clear days between receiving key information about the GAP policy and the sale concluding. Although Ms B likely would have purchased the policy anyway given her expressed need for cover, she was denied the opportunity to review the information in her own time, constituting a loss of opportunity. The fair value complaint was not upheld as the Consumer Duty does not apply retrospectively to 2022 sales, and Ms B's circumstances showed a genuine need for the cover. The commission disclosure complaint was not upheld as Marshall complied with ICOBS 4.3R by disclosing they 'may' receive commission, and the ombudsman found it standard practice for brokers to earn commission and that Ms B was aware she could shop around.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website