Not upheld: settlement adequacy and claims handling delay complaint against The National Farmers Union Mutual Insurance Society Limited (NFU)
Financial Ombudsman decision DRN-6364293 of 2026-05-15T00:00:00+00:00. settlement adequacy and claims handling delay complaint against The National Farmers Union Mutual Insurance Society Limited (NFU). Outcome: Not upheld.
Decision detail
| Reference | DRN-6364293 |
|---|---|
| Decision date | 2026-05-15T00:00:00+00:00 |
| Firm | The National Farmers Union Mutual Insurance Society Limited (NFU) |
| Product | home buildings insurance |
| Claim type | settlement adequacy and claims handling delay |
| Outcome | Not upheld |
| Remedy | NFU to settle the matter with the £9,000 payment as set out by the ombudsman in the October 2023 decision. |
Summary
Mr and Mrs B complained that NFU failed to account for increased material costs in its settlement following a fire in February 2020 and delayed reinstatement work due to not identifying a bat survey requirement. This was the third complaint about the same claim, following previous ombudsman decisions in September 2021 and October 2023. The key issue was that Mr and Mrs B chose to demolish and rebuild their home rather than reinstate the damaged parts, making cost comparisons against NFU's reinstatement liability difficult. The ombudsman found NFU's loss adjustor had conducted thorough costing analysis and that the additional costs claimed by Mr and Mrs B related to rebuild, not reinstatement. The ombudsman concluded NFU had fairly considered the additional information and that the previously offered £9,000 settlement was appropriate, so the complaint was not upheld.
The Ombudsman's reasoning
The ombudsman found that the policy was designed to indemnify Mr and Mrs B against the insured loss by returning them to their pre-fire position, limited to reinstatement of damaged parts. The key issue was that Mr and Mrs B chose to demolish and rebuild rather than reinstate, making cost comparisons difficult. The ombudsman found NFU's loss adjustor had carried out thorough costing for reinstatement work, which was confirmed by a previous ombudsman. The additional costs Mr and Mrs B claimed related to the rebuild project, not reinstatement. The ombudsman was not persuaded that the bat survey delay justified additional payment beyond the £9,000 already offered, as the ecology company confirmed mitigation would have been simpler for reinstatement than rebuild. The ombudsman concluded NFU had fairly considered the additional information provided and that the settlement was reasonable.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| The National Farmers Union Mutual Insurance Society Limited (NFU), all decisions | 2 | 0% |
Source
Read the original decision on the Financial Ombudsman Service website