Not upheld: claim handling delays and unfair treatment following market exit complaint against INTACT INSURANCE UK LIMITED

Decision detail

Summary

Mr and Mrs G complained about Intact's handling of a subsidence claim and its decision to exit the home insurance market. Intact initially declined the claim but reversed this following FOS involvement, and made payments totalling over £210,000 for repairs and loss of rental income. However, delays in payments caused Mr G financial difficulties, leading him to withdraw pension funds and incur credit card and family loan costs. Intact offered £750 compensation for poor handling and £100 for a brief cover lapse, and agreed to provide two years of free cover as it exited the market. The ombudsman found these offers reasonable, rejected Mr G's claims for additional financial losses due to insufficient evidence of direct causation, and found the two-year free cover offer to be fair and providing adequate stability despite Intact's market exit.

The Ombudsman's reasoning

The ombudsman found that while Intact acknowledged unreasonable delays in claim handling, the £750 compensation was fair and in line with FOS guidance for considerable distress and significant inconvenience lasting many weeks or months. Regarding financial losses claimed, the ombudsman found insufficient evidence that delays directly caused the pension withdrawal, credit card interest, or family loan costs, particularly given that Intact made a payment of over £75,000 just four days after the pension withdrawal. On market exit, the ombudsman found that Intact's offer of two years free cover (potentially saving thousands of pounds given £7,000+ annual quotes) provided reasonable stability and certainty, and that the hypothetical concerns about property value and mortgage availability were not supported by evidence of actual harm.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website