Upheld: Service failures generally complaint against Advantage Insurance Company Limited

Decision detail

Summary

Mr R complained about Advantage Insurance's handling of his home insurance renewal, during which the premium changed multiple times in a short period from £716 to £631 to £796 to £863. Advantage initially offered £50 compensation, then £67.35 refund after FOS involvement, explaining the increases were due to claim costs being finalised at over £16,000 rather than the initially estimated £4,850. The ombudsman upheld the complaint, finding that while Advantage were entitled to update the premium when new information became available, they should have anticipated claim cost finalisation and communicated this to Mr R. The ombudsman directed Advantage to pay £67.35 refund plus £100 total compensation for loss of expectation and poor communication.

The Ombudsman's reasoning

While Advantage were entitled to update the renewal offer when new information became available and the contract was not binding until payment, they should have anticipated that claim costs would be finalised before renewal and communicated this to Mr R. The multiple price changes in a short period caused loss of expectation and distress. The unjustified increase to £863 compounded this unfair treatment. The £50 offered was insufficient compensation for the poor communication and loss of expectation caused.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website