Not upheld: credit file administration and complaint handling complaint against First Central Insurance Management Limited

Decision detail

Summary

Mr R complained that First Central recorded a hard search on his credit file after he cancelled a motor insurance policy before it started. He had applied to pay for the policy by monthly instalments, which triggered an affordability check and hard search. The ombudsman found that First Central properly disclosed this procedure in its Credit Agreement and FAQs, and was required to record accurate credit information. Although Mr R experienced frustration when his email responses to the complaint were unsuccessful and the complaint was closed, the ombudsman found no material harm resulted. The complaint was not upheld and no compensation was awarded.

The Ombudsman's reasoning

The ombudsman found that First Central acted fairly and reasonably by recording the hard search because: (1) Mr R agreed to a Credit Agreement which explicitly stated that hard searches would be recorded; (2) the procedure was explained in First Central's FAQs; (3) the hard search was triggered by Mr R's application for monthly instalment payments, which is standard industry practice; (4) First Central is required to record accurate information about credit history; and (5) other lenders would see that the credit agreement was not taken up, and the marker would disappear after one year. Regarding the complaint handling, while the ombudsman acknowledged frustration caused by the email issue and complaint closure, no harm resulted as First Central had already considered and responded to Mr R's points.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website