Not upheld: unfair claim handling; dispute over repair costs and total loss determination complaint against Tesco Underwriting Limited
Financial Ombudsman decision DRN-6366579 of 2026-06-08T00:00:00+00:00. unfair claim handling; dispute over repair costs and total loss determination complaint against Tesco Underwriting Limited. Outcome: Not upheld.
Decision detail
| Reference | DRN-6366579 |
|---|---|
| Decision date | 2026-06-08T00:00:00+00:00 |
| Firm | Tesco Underwriting Limited |
| Product | Motor insurance |
| Claim type | unfair claim handling; dispute over repair costs and total loss determination |
| Outcome | Not upheld |
| Remedy | Tesco has already provided: (1) £13,609 total loss payment (market value of £15,609 less £2000 previously paid for bonnet repair); (2) £1800 compensation for claim handling failings; (3) £1200 payment for estimated hire car costs; (4) waiver of £4683 salvage costs allowing Miss J to retain the car; (5) agreement not to record the claim as a total loss on external databases. No additional remedy ordered. |
Summary
Miss J complained that Tesco Underwriting Limited unfairly handled her motor insurance claim following a rear-end collision. After Tesco's initial repair proved substandard, the firm later reassessed the damage and decided to treat the car as a total loss, offering £13,609 (market value less previous bonnet repair payment) plus £1800 compensation and £1200 for hire costs. Miss J disputed the revised repair cost estimate and sought completion of repairs instead. The ombudsman found the revised damage assessment was fairly reached, the total loss determination was appropriate, and the comprehensive remedial package (including waiver of salvage costs and non-recording as total loss) was fair and reasonable, declining to uphold the complaint.
The Ombudsman's reasoning
The ombudsman found that while Tesco made an error in initially underestimating repair costs, the revised assessment was fairly reached based on work that should have been included in the original estimate. The total loss determination was appropriate given the repair cost exceeded the car's market value. Although an error was made, binding Tesco to its initial mistake would be unfair. The ombudsman considered the total package of remedies (total loss payment without salvage deduction, no total loss recording, £1800 compensation, and £1200 hire car payment) to be fair and reasonable recognition of the failings and their impact on Miss J.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Tesco Underwriting Limited, all decisions | 742 | 40% |
| Motor insurance, all decisions | 23,874 | 35% |
Source
Read the original decision on the Financial Ombudsman Service website