Not upheld: Travel / life insurance claim disputes complaint against Advantage Insurance Company Limited

Decision detail

Summary

Mr A complained that Advantage unfairly avoided his motor insurance policy after he made a claim following an accident, citing his failure to declare car modifications. Mr A claimed he was unaware his car had modifications and was given no notice of the avoidance. The ombudsman found that Mr A made a qualifying misrepresentation under CIDRA by answering 'no' to the modifications question, as the car had a rear spoiler and other non-factory-fitted features that he should reasonably have been aware of or verified. The ombudsman rejected Mr A's claim that the previous owner told him the features were factory-fitted, finding the supporting evidence unreliable. Advantage's decision to avoid the policy and refund premiums was upheld as fair, and the £100 compensation for service failures was deemed reasonable. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the Consumer Insurance (Disclosure and Representations) Act 2012 (CIDRA) and found that Mr A made a qualifying misrepresentation. The modifications, particularly the rear spoiler, were not hidden and Mr A should reasonably have been aware of them or taken steps to verify. The question specifically mentioned spoilers and alloy wheels as examples of modifications. Mr A had multiple opportunities to check (online research, car documentation, contacting Advantage). The evidence Mr A provided to support his claim that features were factory-fitted was unreliable and provided after the avoidance. Advantage's treatment of the misrepresentation as careless (rather than reckless or deliberate) was reasonable. Policy avoidance differs from cancellation and does not require advance notice as it treats the policy as never having existed.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website