Upheld: mis-selling - incorrect advice regarding claims process and access to diagnostic tests complaint against USAY BUSINESS LTD

Decision detail

Summary

Mrs W complained that Usay mis-sold her a private medical insurance policy by incorrectly advising she could use a GP referral to access MRI, CT or PET scans. In reality, the policy required a specialist referral first, with the specialist consultation taken from her £500 outpatient allowance. When Mrs W attempted to claim for an MRI scan in September 2025, the insurer rejected her GP referral and she subsequently cancelled the policy. Usay acknowledged the error and offered £150 compensation, which the investigator increased to £400. Mrs W sought a full refund of premiums paid over two years. The ombudsman upheld the complaint but rejected the premium refund, finding that Mrs W could still have benefited from the policy via the correct pathway and would likely not have purchased different cover had she been given correct advice, given her price sensitivity. The ombudsman directed Usay to pay £400 total compensation for distress and inconvenience.

The Ombudsman's reasoning

Although Usay made an error in advising that a GP referral could be used to access diagnostic scans, the ombudsman found that Mrs W could still have benefited from the policy by following the correct pathway (specialist referral first). The ombudsman was not persuaded that Mrs W would have acted differently had she been given correct advice, particularly given that she had already rejected a more comprehensive policy due to cost. The policy documents contained a claims process diagram explaining the required steps. Therefore, while compensation was appropriate for the loss of expectation and disappointment caused by the error, a full premium refund was not justified.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website