Upheld: unfair policy cancellation; lack of reasonable warning complaint against Advantage Insurance Company Limited

Decision detail

Summary

Mr M complained that Advantage Insurance cancelled his car insurance policy without warning after his telematic device's 14-day driving score dropped below 30, despite his app showing scores between 60 and 80. Analysis of the raw telematic data revealed that Mr M had taken no trips between 6 and 16 May 2025, causing previously high-scoring drives to drop off the 14-day calculation, rather than indicating deteriorated driving behaviour. While Advantage technically complied with strict policy terms, the ombudsman found the cancellation was unfair and unreasonable because Mr M had no reasonable opportunity to correct his behaviour, as he would not have checked his app during a non-driving period and his 365-day score did not trigger a warning notification. The ombudsman upheld the complaint and awarded £300 compensation for avoidable disruption, but rejected Mr M's claims for the £2,250 car sale loss and other out-of-pocket costs as these resulted from his decision to sell the car rather than being direct consequences of the cancellation.

The Ombudsman's reasoning

While Advantage strictly adhered to policy terms by cancelling when the 14-day score dropped below 30, the ombudsman found this was not fair and reasonable. The analysis of raw telematic data revealed that Mr M's score decline was caused by a drop-off in driving activity (no trips recorded between 6-16 May 2025) rather than deteriorated driving behaviour. The policy booklet states the app will clearly show drivers when their score gets close to 30, but Mr M would have had no reason to check the app during a period of non-driving, and his 365-day score did not reach the threshold that would trigger a warning notification. Therefore, Mr M did not have a reasonable chance to correct his behaviour before cancellation. The ombudsman rejected claims for the car sale loss (£2,250) and out-of-pocket costs as these resulted from Mr M's decision to sell the car, which involved external variables beyond Advantage's direct responsibility, though compensation was awarded for the avoidable disruption and inconvenience caused by the unreasonable cancellation.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website