Not upheld: claim decline, policy voidance, and premium retention based on non-disclosure of material fact complaint against HDI Global Specialty SE

Decision detail

Summary

B, a business, complained that HDI Global Specialty SE unfairly declined a claim for a stolen laser machine, voided the policy, and retained the premium. When B took out commercial insurance with HDI in 2025, it confirmed it did not use lasers, but later claimed for loss of a high-value Alma laser machine following a burglary. The ombudsman found that B had run quotations for laser equipment use before obtaining cover, and the evidence suggested B was using lasers from the time it sought insurance. The ombudsman concluded that B breached its legal duty under the Insurance Act 2015 to make a fair presentation of the risk by failing to disclose laser equipment use, and that this breach was deliberate or reckless. As HDI's underwriting evidence confirmed it would not have offered cover had the true position been disclosed, the ombudsman upheld HDI's decision to void the policy and retain the premium.

The Ombudsman's reasoning

B had a legal duty under the Insurance Act 2015 to make a fair presentation of the risk by disclosing all circumstances that would influence a prudent insurer's decision. The evidence shows B ran a quotation for laser use, which was declined, then re-ran it excluding lasers to obtain cover. The fact that B was claiming for the laser equipment itself, combined with the absence of credible reason to keep such equipment on site if not in use, indicates B was using lasers from the time it sought cover. This failure to disclose was at least reckless, most likely deliberate. HDI's underwriting evidence confirms it would not have offered cover had the true position been disclosed, entitling HDI to void the policy. As the breach was deliberate or reckless, HDI was not required to refund the premium.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website