Not upheld: mis-selling / suitability of insurance advice complaint against Sutcliffe Insurance Brokers Limited

Decision detail

Summary

Mr L, a sole trader operating an online business, complained that Sutcliffe Insurance Brokers Limited mis-sold him a combined liability insurance policy with public/products liability and professional indemnity cover. Mr L argued he was over-insured, particularly regarding public liability cover which was unlikely to be needed for an online business, and that cheaper alternatives should have been offered. The ombudsman found that professional indemnity cover was genuinely required and that the combined policy was the most cost-effective option available, as standalone professional indemnity cover would have been more expensive. The ombudsman also found that Sutcliffe was not required to conduct a wider market search and had properly disclosed its limited approach. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Sutcliffe properly established R's needs and that professional indemnity cover was genuinely required. While public liability claims were less likely given the online nature of the business, the ombudsman considered it still possible for claims to be made and therefore reasonable to recommend. The ombudsman noted that Sutcliffe was not required to conduct a fair analysis of the wider market and had disclosed it only approached its scheme provider. The evidence suggested that a combined policy was the most cost-effective way to obtain the necessary professional indemnity cover. The 2025 premium reduction was due to changed underwriting criteria, not overcharging, and there was no evidence the insurer would have offered lower premiums for reduced indemnity limits prior to that change.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website