Upheld: mis-selling / inadequate advice on insurance coverage complaint against Howden UK Brokers Limited

Decision detail

Summary

Mr M purchased contents insurance through Howden for items including a watch worth £46,500 and a necklace worth £40,000. While Howden correctly specified the necklace as a specified item, it failed to do the same for the watch, instead adding it as unspecified jewellery. When Mr M claimed for theft, the insurer settled the necklace in full but limited the watch settlement to £15,000 (the single article limit for unspecified items), leaving a £31,500 shortfall. The ombudsman found Howden's error was compounded by misleading policy documentation that suggested full coverage for the watch value. As a professional intermediary conducting an advised sale, Howden should have properly specified the high-value watch and clearly communicated the significant single article limit. The ombudsman upheld the complaint and ordered Howden to pay £31,500 compensation.

The Ombudsman's reasoning

This was an advised sale, so Howden had to take reasonable care to ensure suitability of advice, provide clear and fair information, and appropriately highlight significant or onerous terms. When Mr M stated he had a watch worth £46,500, Howden should have added it as a specified item (as it correctly did with the necklace) rather than adding it as unspecified jewellery. The policy document was misleading because it stated cover for £46,500 for unspecified items without mentioning the £15,000 single article limit, giving Mr M the false impression he was fully insured. Howden's own admission that it could have probed further supports this finding. The only barrier to full claim payment was the limit that resulted from Howden's error, so Howden must compensate for the entire shortfall.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website