Not upheld: Travel / life insurance claim disputes complaint against Royal London Mutual Insurance Society Limited

Decision detail

Summary

Ms C complained that Royal London delayed in making a benefit payment on her critical illness cover policy, which she claimed should have been paid in 2006 when she first contacted them about her condition. However, the ombudsman found that Ms C only made an enquiry in 2006 (and was correctly told ME was not covered) and did not submit a formal claim for total permanent disability until 2025. Royal London accepted the claim and paid it with interest, backdating it to 2006 as a gesture of goodwill, which actually benefitted Ms C by providing a higher sum assured. The ombudsman concluded that Royal London had not acted unreasonably and rejected the complaint.

The Ombudsman's reasoning

The ombudsman found that Royal London could not have paid the benefit sooner because no formal claim for TPD was made before 2025. Ms C only made an enquiry in 2006 and was correctly informed that ME was not covered. The ombudsman noted that Royal London's decision to backdate the claim as a gesture of goodwill actually benefitted Ms C, as she received the higher sum assured from 2006 rather than the lower amount applicable in 2025. The ombudsman concluded that Royal London had not made an error or acted unreasonably, and that the interest payment and tax deduction were in accordance with Royal London's normal practice.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website