Not upheld: claim decline and policy cancellation based on failure to safeguard vehicle complaint against Marshmallow Insurance Limited

Decision detail

Summary

Mr L complained about Marshmallow Insurance's decline of his theft claim and cancellation of his motor insurance policy after his car was stolen on 6 July 2025. Marshmallow declined the claim on the basis that Mr L failed to safeguard a vehicle key, allowing thieves to steal the car. The ombudsman reviewed expert evidence including an engineer's report and forensics specialist opinion, which confirmed the vehicle requires a key to start and is not susceptible to relay theft, and found no signs of forced entry when the car was recovered locked. The ombudsman concluded that Mr L's initial uncertainty about possessing one or two keys, combined with the unknown location of a spare key allegedly lost in 2018, supported Marshmallow's finding that Mr L breached the policy requirement to take all reasonable care to safeguard the vehicle. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that expert evidence conclusively demonstrated the car could only be stolen with a key, as it is not keyless, not susceptible to relay theft, and showed no signs of forced entry when recovered. The car was found locked, indicating the thieves possessed a key. Mr L's initial uncertainty about whether he had one or two keys, combined with the unknown location of the spare key allegedly lost in 2018, supported the conclusion that Mr L failed to take all reasonable care to safeguard the vehicle as required by the policy terms. Therefore, Marshmallow acted reasonably in declining the claim and cancelling the policy under the terms Mr L had agreed to.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website