Not upheld: Home insurance claim disputes complaint against ARAG Legal Expenses Insurance Company Limited

Decision detail

Summary

Mr S claimed on his legal expenses insurance policy with ARAG to fund a dispute against the seller of his property for misrepresentation. ARAG initially confirmed cover and appointed panel solicitors, but later declined the claim based on a policy exclusion that excludes disputes over property sales except those involving professional advisers. Mr S complained that ARAG gave unqualified confirmation of cover before withdrawing it and that the exclusion was not clearly presented in his policy documents. The ombudsman found ARAG's application of the exclusion was fair and reasonable, as Mr S's dispute was against the seller rather than a professional adviser, and found no evidence of detriment caused by ARAG's delay in identifying the exclusion.

The Ombudsman's reasoning

The ombudsman found that ARAG's application of the policy exclusion was reasonable and in line with the policy terms, as Mr S's dispute was clearly against the seller rather than a professional adviser. Although ARAG should have identified the exclusion from the outset, the ombudsman found no evidence that the delay in communicating this decision caused Mr S detriment, prejudice, or loss of opportunity, as Mr S lacked funds to pursue the claim independently and had not explored alternative options after receiving the decline decision.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website