Not upheld: unfair claim decline complaint against Admiral Insurance (Gibraltar) Limited

Decision detail

Summary

Mrs L claimed for ceiling collapse under her home insurance policy as accidental damage. Admiral declined the claim, attributing the damage to gradual wear and tear of the lath and plaster ceiling rather than a sudden, accidental event. The ombudsman found that while the collapse appeared sudden to Mrs L, Admiral's assessment that the failure resulted from gradual deterioration of the brittle plaster and lath was reasonable. The policy contained an exclusion for gradual causes including wear and tear, which Admiral was entitled to rely upon. The ombudsman upheld Admiral's decision as fair and reasonable, applying standard FOS practice that insurers may decline accidental damage claims based on gradual cause exclusions regardless of the policyholder's awareness of the underlying defect.

The Ombudsman's reasoning

While the damage appeared sudden and unexpected from Mrs L's perspective and met the policy definition of accidental damage, Admiral was entitled to rely on the policy's exclusion for gradual causes. The ombudsman found Admiral's assessment that the ceiling failure was caused by gradual wear and tear of the lath and plaster was reasonable. The ombudsman applied the standard FOS approach that for accidental damage claims, it is fair for insurers to rely on gradual damage exclusions to decline claims, as this protects policies from paying for maintenance issues that are homeowners' liability.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website