Not upheld: non-disclosure of medical condition in insurance application; misrepresentation complaint against Legal and General Assurance Society Limited

Decision detail

Summary

Mr C complained that Legal and General Assurance Society Limited unfairly added an exclusion for osteoarthritis to his income protection policy in 2025, despite him having disclosed arthritis when applying for a term assurance policy with L&G in 2021. Mr C claimed he had also disclosed the condition when applying for the income protection policy in 2023, but it was not included in the paperwork. The ombudsman found that L&G had asked a clear health questionnaire question about arthritis, and the answer provided was 'no', which L&G was reasonable to rely upon. Although Mr C was given the opportunity to check and amend the information in December 2023, he did not do so. The ombudsman held that L&G was not responsible for cross-referencing information from the earlier life policy and that the addition of the exclusion was fair and in accordance with the Consumer Insurance Disclosure and Representations Act 2012.

The Ombudsman's reasoning

The ombudsman applied the Consumer Insurance Disclosure and Representations Act 2012 (CIDRA) and found that L&G received an incorrect answer ('no') to a clear health questionnaire question about arthritis, which it was reasonable to rely upon. Although Mr C had disclosed arthritis in his 2021 life policy application, the ombudsman found it was not L&G's responsibility to cross-reference information between separate policies or to update the income protection policy of its own accord. Mr C was given the opportunity to check and amend the information in December 2023 but did not do so. The ombudsman found this constituted careless misrepresentation under CIDRA, and L&G acted fairly and in accordance with the law by adding an exclusion retrospectively. The different treatment between the two policies was justified because they provide benefits in different circumstances and the actively managed arthritis posed an increased risk of incapacity for income protection purposes.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website