Not upheld: unfair claims settlement and liability determination complaint against Highway Insurance Company Limited

Decision detail

Summary

Mr B complained that Highway Insurance unfairly settled a third-party motor insurance claim by initially recording it as his fault without contacting him or considering his evidence. After Mr B raised concerns in May 2025, Highway reviewed the case and amended the liability to 50/50 based on insufficient evidence to determine fault. Highway paid £75 as a goodwill gesture but refused to remove the claim from records or compensate for loss of no claims discount. The ombudsman found the 50/50 settlement reasonable given both parties were reversing and contradicting each other, and upheld Highway's decision not to remove the claim or provide additional compensation.

The Ombudsman's reasoning

The ombudsman noted that while insurers have discretion to settle claims under policy terms, this discretion must be exercised reasonably based on facts and evidence. Without material evidence proving fault one way or another, and with both parties reversing and blaming each other, a 50/50 liability split was reasonable. The ombudsman could not order removal of the claim from records as there was a reportable incident that must be recorded. The loss of no claims discount was a standard consequence of a fault claim under the policy terms.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website