Upheld: unfair claim handling and inadequate cash settlement for repair works complaint against UK Insurance Limited
Financial Ombudsman decision DRN-6400983 of 2026-06-02T00:00:00+00:00. unfair claim handling and inadequate cash settlement for repair works complaint against UK Insurance Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-6400983 |
|---|---|
| Decision date | 2026-06-02T00:00:00+00:00 |
| Firm | UK Insurance Limited |
| Product | buildings insurance |
| Claim type | unfair claim handling and inadequate cash settlement for repair works |
| Outcome | Upheld |
| Remedy | UKI directed to pay Ms G £950 to resolve the moisture-resistant plasterboard issue, plus 8% simple yearly interest from the date UKI first offered £390 until settlement. UKI to provide tax deduction certificate if required. |
Summary
Ms G claimed on her buildings insurance policy with UKI following water damage from a leak in the flat upstairs. While UKI accepted the claim and arranged repairs, a dispute arose over whether moisture-resistant plasterboard should have been used when replacing the shower room ceiling. UKI offered £390 but Ms G, a professionally qualified person, estimated the cost at £950, later supported by an independent consulting estimate of £2,461.50. The ombudsman found UKI's £390 offer incomplete and unfair, directing payment of £950 plus interest. The ombudsman rejected complaints about fungicidal timber treatment and recovery process delays as fairly handled by UKI.
The Ombudsman's reasoning
The ombudsman found that £390 was not a fair or reliable figure because UKI's breakdown was incomplete, omitting removal of existing ceiling, waste disposal, cleaning, and electrical work. Since UKI chose a cash payment rather than arranging the work itself, the offer should have been based on open market costs. Ms G's consistent estimate of £950, supported by her professional qualifications and the independent consulting estimate, was found to be fair and reasonable. The ombudsman rejected the £2,461.50 estimate as being almost three times Ms G's own estimate and almost half the cost of the entire project. Regarding timber treatment, the ombudsman found UKI acted fairly by relying on contractors' inspection that timbers were dry and didn't require treatment. On the recovery process, the ombudsman found UKI could not reasonably pursue recovery earlier when liability was disputed and the leak was continuing.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| UK Insurance Limited, all decisions | 3,730 | 33% |
Source
Read the original decision on the Financial Ombudsman Service website