Upheld: unfair claim settlement and wrongful decline of claim complaint against QIC Europe Ltd

Decision detail

Summary

Mr L and Miss P claimed on their home insurance with QIC Europe Ltd for damage caused by two basement leaks in early 2023 that rotted wooden floorboards and joists. QIC initially declined the claim, then agreed to cover above-ground damage but refused below-ground damage. After a previous Ombudsman decision required reimbursement for floor repairs, QIC still refused to pay other basement repair costs, arguing betterment and that repairs could have cost less. The Ombudsman upheld the complaint, finding all repairs were claim-related and necessary, that no betterment occurred, and that QIC's refusal to complete repairs themselves left Mr L and Miss P no choice but to arrange their own repairs at the costs they incurred. QIC was directed to pay full claim costs plus 8% interest and £500 compensation.

The Ombudsman's reasoning

The Ombudsman found that all repairs were claim-related and corresponded to damage identified by both surveyors. The kitchen replacement and other extensive remedial works were necessary to enable floor repairs and make the basement habitable, with upgrades to meet modern building standards being essential for a lasting repair rather than betterment. By declining to complete repairs themselves, QIC left Mr L and Miss P no option but to arrange their own repairs, and there was no compelling evidence they failed to control costs. Therefore, QIC should reimburse the full claim costs plus interest and compensation for inconvenience.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website