Upheld: unfair policy cancellation; failure to investigate misrepresentation concerns; poor customer service complaint against Wakam UK Limited
Financial Ombudsman decision DRN-6293796 of 2026-04-15T00:00:00+00:00. unfair policy cancellation; failure to investigate misrepresentation concerns; poor customer service complaint against Wakam UK Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-6293796 |
|---|---|
| Decision date | 2026-04-15T00:00:00+00:00 |
| Firm | Wakam UK Limited |
| Product | motor insurance |
| Claim type | unfair policy cancellation; failure to investigate misrepresentation concerns; poor customer service |
| Outcome | Upheld |
| Remedy | Wakam UK Limited must: (1) Remove all record of the cancellation from internal and external databases; (2) Write a letter to Miss Z explaining the policy was not cancelled and she does not need to declare it to future insurers; (3) Pay £656.90 for the difference in premium between Wakam's policy (£1,760.40) and Miss Z's new policy (£2,417.30); (4) Pay 8% interest on the premium difference from the date of cancellation until payment; (5) Pay £250 compensation for distress caused by the unfair cancellation and poor communication. |
Summary
Miss Z complained about Wakam UK Limited's cancellation of her motor insurance policy. Wakam believed Miss Z's sister was the main driver rather than Miss Z based on the sister's contact details being used and the sister's previous attempt to take out a policy. The ombudsman found that Miss Z, as the registered owner of the vehicle with a plausible explanation for using her sister's details, did not misrepresent the main driver. Wakam cancelled the policy unfairly without proper investigation and failed to respond to Miss Z's live chat requests. The ombudsman upheld the complaint and directed Wakam to remove the cancellation record, pay £656.90 for the premium difference plus 8% interest, and pay £250 compensation.
The Ombudsman's reasoning
The ombudsman applied CIDRA to assess whether Miss Z made a qualifying misrepresentation. A qualifying misrepresentation requires the insurer to show the consumer failed to take reasonable care and that the insurer would have offered different terms or not at all. The ombudsman found that Miss Z, as the registered owner and keeper of the vehicle with a plausible explanation for using her sister's details, did not misrepresent who the main driver was. The use of family contact details and correspondence through a family member is not unusual and does not prove the sister was the main driver. Wakam failed to investigate their concerns before cancelling and failed to respond to Miss Z's attempts to communicate through live chat. The cancellation was therefore unfair and without valid legal basis.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Wakam UK Limited, all decisions | 16 | 69% |
Source
Read the original decision on the Financial Ombudsman Service website