Not upheld: claim declined - alleged unfair treatment complaint against ARAG Legal Expenses Insurance Company Limited

Decision detail

Summary

Mr S and Mrs T claimed under their ARAG Homebuyers Protection Insurance policy following issues with a property purchase, citing three insured events: the seller's lack of legal entitlement to sell, the mortgage lender's insistence on rectification work, and property damage during the policy period. ARAG declined the claim. The ombudsman examined each insured event and found that the seller was legally entitled to sell despite an identity discrepancy, the mortgage lender did not insist on rectification work, and there was no evidence of property damage during the policy period. The complaint was not upheld as ARAG's decision to decline the claim was correct and in accordance with the policy terms.

The Ombudsman's reasoning

The ombudsman examined each of the three insured events claimed (clauses 4, 8, and 10) against the policy terms. For clause 4, the evidence showed the seller was legally entitled to sell despite the identity discrepancy. For clause 8, the mortgage lender did not insist on rectification work before releasing funds. For clause 10, there was no evidence the property sustained damage during the policy period. The ombudsman concluded the circumstances did not fall within any insured events and the policy terms were clear and unambiguous.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website