Not upheld: claim rejection / unreasonable interpretation of policy coverage complaint against AmTrust Specialty Limited

Decision detail

Summary

Mr L complained that AmTrust Specialty Limited unreasonably rejected his legal expenses insurance claim relating to a sports governing body's refusal of his membership application. AmTrust concluded the claim was not covered because Mr L had not entered into a contract with the governing body and the claim did not fall within other insured events. The ombudsman upheld AmTrust's decision, finding that since the membership application was not accepted, no contract was formed, and therefore the claim could not be covered under the 'Contract' section. The ombudsman also found that Mr L had not disclosed his former employment with the governing body to AmTrust and there was insufficient connection between any past employment contract (ending in 2015) and the 2025 membership application dispute to trigger coverage under the employment disputes section. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the legal principles of contract formation (offer, acceptance, consideration, intent to create legal relations, and capacity) and concluded that since Mr L's membership application was not accepted, no contract was formed. Therefore, the claim could not fall within the 'Contract' section of the policy. Regarding the employment disputes section, the ombudsman found that Mr L had not disclosed his former employment status to AmTrust and there was insufficient connection between any past employment contract (which ended in 2015) and the 2025 membership application dispute. The ombudsman also found that the legal helpline did not indicate the policy would cover the membership application claim and that judicial review was the appropriate legal route, which was excluded from cover.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website