Partially upheld: claim settlement, eligibility verification, claims handling delays complaint against Legal and General Assurance Society Limited
Financial Ombudsman decision DRN-6106870 of 2026-04-29T00:00:00+00:00. claim settlement, eligibility verification, claims handling delays complaint against Legal and General Assurance Society Limited. Outcome: Partially upheld.
Decision detail
| Reference | DRN-6106870 |
|---|---|
| Decision date | 2026-04-29T00:00:00+00:00 |
| Firm | Legal and General Assurance Society Limited |
| Product | critical illness insurance |
| Claim type | claim settlement, eligibility verification, claims handling delays |
| Outcome | Partially upheld |
| Remedy | L&G directed to: (1) Pay £400 total compensation (inclusive of £150 already offered); (2) Refund premiums paid for the additional £25,000 cover from 1 November 2024 until settlement date (£310.63 identified). Mrs S remains able to provide evidence of legal separation to request reassessment, with potential deduction of refunded premiums from any further settlement. |
Summary
Mrs S complained that L&G failed to fully settle her critical illness insurance claim following a cancer diagnosis. She had requested to increase her cover from £25,000 to £50,000 in October 2024 by removing her husband as a dependent, citing a lifestyle event (legal separation). L&G initially denied the full £50,000 claim by linking her previous gastritis to her cancer diagnosis. After Mrs S appealed with medical evidence, L&G's Chief Medical Officer agreed there was no link between the conditions. However, L&G then questioned whether Mrs S had a qualifying legal separation to amend her cover, and when she failed to provide court-ordered separation evidence, maintained the settlement at £25,000. The ombudsman upheld the £25,000 settlement as fair but found L&G's claims handling deficient for not identifying the eligibility issue promptly, causing Mrs S avoidable delays and inconvenience during her recovery. L&G was directed to pay £400 compensation and refund the additional premiums paid for the unsubstantiated cover increase.
The Ombudsman's reasoning
While L&G was entitled to require evidence of a qualifying lifestyle event (legal separation) to support the benefit increase, it failed to identify this eligibility issue promptly when the claim was first made. This caused Mrs S unnecessary delays and required her to obtain additional medical evidence while recovering from surgery. Although the gastritis-cancer link was not established by the CMO, L&G should have investigated eligibility earlier. The settlement amount of £25,000 was fair given the lack of evidence of legal separation, but the claims handling process was deficient.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Legal and General Assurance Society Limited, all decisions | 1,099 | 18% |
Source
Read the original decision on the Financial Ombudsman Service website