Not upheld: no claims discount mismanagement and policy terms clarity complaint against Tesco Underwriting Limited

Decision detail

Summary

Mr E complained that Tesco Underwriting Limited mismanaged his no claims discount by failing to recognise his 16 years of claims-free driving and refusing to confirm a longer NCD period to his new insurer, resulting in higher premiums. Tesco's policy provided a maximum of 9 years NCD, which was reduced to 3 years following a fault claim. The ombudsman found that Tesco's policy terms were clearly communicated and not unfair, and that Mr E accepted these terms by taking out the policy. The complaint was not upheld, although Tesco's £50 compensation offer for a minor service issue (failure to arrange a callback) was accepted as reasonable.

The Ombudsman's reasoning

The ombudsman found that Tesco's maximum NCD period of 9 years is common industry practice and not necessarily unfair. The policy documentation clearly communicated the maximum NCD period, that it was not protected, and how it would be reduced following a claim. Mr E accepted these terms by taking out the policy. While the ombudsman acknowledged Mr E's frustration, the policy terms were clear, not unusual, and it was for Mr E to decide whether to accept them. The ombudsman did not require additional transparency warnings beyond what was already provided.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website