Not upheld: claim declined - breach of reasonable care policy term complaint against Assurant General Insurance Limited

Decision detail

Summary

Mr G claimed under his mobile phone insurance policy after losing his phone while riding his motorbike for approximately one hour. He had placed the phone in an unsecured trouser pocket despite having safer storage options available (zipped pockets and under-seat storage). Assurant declined the claim based on a 'reasonable care' policy term. The ombudsman found that Mr G acted recklessly by failing to take adequate measures to protect his phone, particularly given that he had recognised similar risks with his keys and second phone and had taken greater protective measures for those items. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied relevant case law establishing that an insurer must show the policyholder acted recklessly to rely on a 'reasonable care' term. Recklessness requires the policyholder to have recognised a risk but taken no or inadequate measures to lower it. The ombudsman found it would have been apparent to Mr G that there was a clear risk of the phone falling out while riding a motorbike for an hour. The fact that Mr G had taken greater protective measures for his keys and second phone demonstrated he recognised risks and could take precautions, yet chose not to do so for his primary phone. Therefore, Mr G acted recklessly, and Assurant fairly declined the claim.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website