Not upheld: claim handling delays, poor communication, and premium increase fairness complaint against Liverpool Victoria Insurance Company Limited

Decision detail

Summary

Mr and Mrs W complained to the FOS about LV's handling of their subsidence claim and the resulting premium increase from approximately £800 to £5,000 over four years. The subsidence claim, initiated in late 2022, involved removal of trees subject to tree preservation orders and continued monitoring through 2025. LV paid £750 compensation for avoidable delays and poor communication during the claim process. The ombudsman found the compensation fair and the premium increase justified, as it was consistent with LV's underwriting criteria and aligned with ABI guidance on subsidence claims, despite acknowledging customers' limited ability to switch insurers during ongoing claims.

The Ombudsman's reasoning

The ombudsman found that LV took reasonable steps to progress the subsidence claim in line with professional arborist advice and good industry practice. Although there were periods of avoidable delay and poor communication, the £750 compensation was fair. Regarding the premium increase, while significant, it was consistent with LV's underwriting criteria applied to all customers in similar circumstances and aligned with ABI guidance. The ombudsman acknowledged that customers with ongoing subsidence claims have limited options to switch insurers, but found the premium increase was at the upper end of typical increases following subsidence claims and not unreasonable.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website