Upheld: claim handling delay and unfair claim decline complaint against Great Lakes Insurance UK Limited

Decision detail

Summary

Mr N claimed on his travel insurance after his flight was cancelled due to airport runway maintenance. Although he received an airline refund, his non-refundable hotel (£603.77) was lost. GLI declined the claim as the cancellation was not an insured event under the policy. However, GLI took over two months to assess the claim (until 20 November 2025), well beyond their 21-day standard timescale and after the hotel dates had passed. The ombudsman upheld the complaint, finding that GLI's delay prejudiced Mr N's ability to mitigate losses by rebooking alternative flights or rescheduling travel. The ombudsman directed GLI to reimburse the hotel costs (less the airline refund Mr N received) and pay £100 compensation, as Mr N would have travelled had he received a timely claim decision.

The Ombudsman's reasoning

Although the flight cancellation due to airport maintenance was not an insured event under the policy's cancellation section, the ombudsman's remit extends beyond strict application of policy terms to consider what is fair and reasonable in all circumstances. GLI's delay in assessing the claim (over two months, when 21 days was standard) prejudiced Mr N's ability to explore alternatives such as booking alternative flights from different airports or rescheduling to reduce hotel losses. Had GLI declined the claim by end of September 2025, Mr N would have had time to mitigate the loss. The fair remedy is to reimburse the hotel costs (deducting the airline refund Mr N already received, as he would have needed to spend that on new flights) plus £100 compensation for inconvenience and poor handling.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website