Not upheld: Motor insurance, claim handling complaint against Admiral Insurance (Gibraltar) Limited

Decision detail

Summary

Mr and Mrs T claimed on their home insurance policy after a burglary resulted in stolen jewellery and a watch. Admiral accepted the claim and offered settlement via vouchers for full replacement value, which the customers rejected. Admiral then offered cash settlement based on like-for-like replacement using supplier discounts, which the customers considered inadequate. The ombudsman found Admiral's approach was fair and compliant with the policy terms, which explicitly permit settlement at the cost Admiral would pay to repair or replace items, not necessarily the customer's retail cost. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Admiral's settlement approach was fair and compliant with the policy terms. The policy explicitly allows Admiral to settle claims by paying 'the cost of repairing, restoring or replacing the item' which may be less than the customer's actual cost. Since Admiral offered vouchers for the full specified amount (which would have indemnified the customers), and the customers declined this option, it was reasonable for Admiral to then offer cash settlement based on Admiral's supplier costs. The policy terms are standard for home contents insurance and were agreed when the policy was purchased.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website