Not upheld: unfair claim decline based on policy exclusions complaint against HCC International Insurance Company Plc trading as Tokio Marine HCC

Decision detail

Summary

Mr W claimed on his marine insurance policy after his boat's sponson was damaged when he reported hitting a submerged log in June 2025. HCC appointed two marine surveyors who disagreed on causation but agreed the sponsons were in poor condition with age-related deterioration and previous repairs. HCC declined the claim relying on the gradual deterioration exclusion, offering 25% as a gesture of goodwill. The ombudsman upheld HCC's decision, finding the sponsons were worn and deteriorating, the log impact highlighted a pre-existing issue, and the deterioration should have been identified during servicing, making the exclusion fairly applicable.

The Ombudsman's reasoning

The ombudsman found that while both surveyors disagreed on whether the collision caused the damage, they agreed on the critical issue: the sponsons were in poor condition due to age-related wear and deterioration. The ombudsman concluded that hitting the log highlighted a pre-existing issue rather than being the primary cause of damage. The gradual deterioration exclusion in section 4.11 of the policy fairly applied because the sponsons were worn, patched, and deteriorating, and this condition should have been identified during routine servicing. The ombudsman was not persuaded by Mr W's evidence that the boat was in good condition, finding the surveyor reports and photographs more compelling.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website