Not upheld: Motor insurance, claim handling complaint against The National Farmers' Union Mutual Insurance Society Limited

Decision detail

Summary

Miss W claimed on legal expenses insurance for costs relating to flooding of her land and blocked access caused by neighbours. NFUM initially declined but later agreed to consider the claim. However, the neighbours had issued proceedings against Miss W before she added the legal cover, and she filed a defence and counterclaim. Panel solicitors advised all issues were too interlinked to separate. NFUM agreed to cover only the nuisance claim costs but not the defence/counterclaim costs as those predated the cover. Miss W disputed this and claimed other solicitors advised the issues could be separated, but provided no written legal opinion. The ombudsman found NFUM acted fairly in relying on the panel solicitors' advice and applying the policy terms correctly, and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman applied the policy terms as the starting point, noting that cover only applies to disputes arising from events occurring during the period of insurance. Since legal proceedings were already issued before Miss W added the cover, costs relating to the defence and counterclaim were not covered. NFUM was entitled to rely on the panel solicitors' professional legal advice that all issues needed to be dealt with together and could not be isolated. The ombudsman found NFUM acted reasonably in offering to cover only the proportionate costs relating to the nuisance claim. The ombudsman noted that Miss W's alternative legal advice was not provided in writing for NFUM to consider, and that NFUM had attempted to appoint Miss W's nominated solicitors if they would confirm reasonable prospects of success.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website