Upheld: ongoing cover eligibility and premium refunds for ineligible dependents complaint against ReAssure Limited

Decision detail

Summary

Mr J complained that ReAssure continued charging him for child cover on his Crisis Cash Cover policy after his children were no longer eligible for benefits. ReAssure initially refused the complaint, stating it was Mr J's responsibility to notify the business. ReAssure subsequently offered to refund child cover premiums from December 2018 to October 2025 with 8% interest plus £350 compensation, but Mr J felt the refund should apply from 2009 when his children became ineligible. The ombudsman upheld the complaint, accepting ReAssure's settlement offer as fair and reasonable, finding that while ReAssure could not have known when children became ineligible, Mr J should not have paid for unusable cover after December 2018, and that some responsibility rests with the policyholder to ensure cover remains suitable.

The Ombudsman's reasoning

The ombudsman found that while the policy terms do not explicitly require Mr J to notify ReAssure when children become ineligible, there is no provision requiring ReAssure to monitor children's ages or automatically remove cover. ReAssure could not reasonably have known when Mr J's children reached age 17. However, the ombudsman accepted that Mr J should not have continued paying for cover he could not claim on after December 2018 (when the return of premium was made). The refund of child cover premiums from December 2018 onwards with 8% interest was considered fair and reasonable, as it puts Mr J back in the position he would have been in had no error occurred. The 2018 return of premium was made under the contract's own terms and should not be refunded again. Some responsibility rests with the policyholder to ensure cover remains suitable for their needs.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website