Upheld: unfair claim decline due to unclear policy term changes and inadequate communication of material changes complaint against AXA Insurance UK Plc

Decision detail

Summary

Mr F and Ms D held a holiday home insurance policy with AXA that was renewed annually from 2019. In January 2025, they claimed for escape of water damage, but AXA declined the claim based on an unoccupancy clause. The property had not been 'lived in' for 30 days prior to the claim, though it was visited weekly by a property manager. The ombudsman found that AXA had materially changed the unoccupancy definition from 'visited' to 'lived in' in October 2023 without clearly communicating this change to the customers. Since the property would have been covered under the previous definition, the ombudsman upheld the complaint, requiring AXA to pay the claim and provide £500 compensation.

The Ombudsman's reasoning

The ombudsman found that while AXA made a material change to the unoccupancy definition in October 2023, it failed to bring this change to Mr F and Ms D's attention in a clear way. The change from 'visited' to 'lived in' was only apparent when both the endorsement and definition changes were reviewed together. The renewal call recording showed the agent discussed general changes but did not specifically mention the unoccupancy definition change. The ombudsman concluded that a renewing customer would not be expected to identify such changes without specific prompting, and therefore it was unfair for AXA to rely on the endorsement to decline the claim.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website