Partially upheld: service failure, administrative errors, unclear communication, policy cancellation complaint against Aviva Insurance Limited

Decision detail

Summary

Mr P and Mr W complained about service failures by Aviva Insurance Limited regarding their private health insurance policy. After requesting a direct debit billing date change, Aviva made internal errors that resulted in failure to collect premiums for several months, leaving approximately £700 outstanding. Aviva offered to waive premiums up to 7 April 2025 but Mr P and Mr W did not pay the remaining outstanding premiums for April, May, and June 2025, leading to policy cancellation in June 2025. The ombudsman found Aviva's offer was fair and reasonable and the policy cancellation was justified, but awarded £250 compensation for the distress and inconvenience caused by Aviva's errors and confusing communications.

The Ombudsman's reasoning

The ombudsman found that while Aviva made errors in changing the billing date and collecting premiums, its offer to waive premiums up to 7 April 2025 was fair and reasonable as it acknowledged the errors, apologised, and offered compensation through premium waiver. Although Aviva's mistakes led to the initial non-collection of premiums, Mr P and Mr W were reasonably made aware that premiums from April 2025 onwards would need to be paid for the policy to continue. Since they did not pay these premiums, the policy cancellation in June 2025 was reasonable and in line with policy terms. However, the ombudsman accepted that Aviva's errors caused unnecessary distress and inconvenience through confusing communications and lack of clarity about the new policy number.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website