Not upheld: policy avoidance for misrepresentation; failure to disclose County Court Judgements complaint against AXA Insurance UK Plc

Decision detail

Summary

Mrs S complained that AXA unfairly avoided her Park Home insurance policy and declined her fire claim after discovering two undisclosed County Court Judgements during claim validation. AXA had asked a clear question about CCJs during the application process, which Mrs S answered 'no' to, though CCJs existed in both her and her husband's names. Mrs S claimed she was unaware of the CCJs. The ombudsman found that Mrs S either should have been aware of the CCJs or failed to take reasonable care in verifying her answers, and that AXA would not have offered cover if the CCJs had been disclosed. The ombudsman upheld AXA's right to avoid the policy under CIDRA as a careless misrepresentation and found the refund of premiums to be fair and reasonable.

The Ombudsman's reasoning

The ombudsman applied the Consumer Insurance (Disclosure and Representations) Act 2012 (CIDRA), which requires consumers to take reasonable care not to make misrepresentations. The ombudsman found that Mrs S either should have been aware of the CCJs or failed to take reasonable care in checking her answers before submitting the application. The question was clear and unambiguous. Even if Mrs S was genuinely unaware, a reasonable consumer would have checked for CCJs given the specific question asked. AXA provided underwriting evidence that it would not have offered cover if the CCJs had been disclosed, making this a qualifying misrepresentation. As the misrepresentation was careless rather than deliberate, AXA was entitled to avoid the policy under CIDRA and refund premiums.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website