Not upheld: Travel / life insurance claim disputes complaint against Great Lakes Insurance UK Limited

Decision detail

Summary

Ms W, a landlord, arranged insurance with Great Lakes in September 2020 for her let property, answering 'no' when asked if tenants were in breach of their tenancy agreement. The policy included cover for accidental and malicious damage by tenants. When tenants caused damage in 2025 and Ms W claimed, Great Lakes discovered she had previously had rent arrears issues, damage caused by the tenant, and had started eviction proceedings in 2018. Great Lakes removed the accidental and malicious damage cover and declined the claim. The ombudsman found Ms W had failed to make a fair presentation of the risk by not disclosing these material prior issues, and that Great Lakes was entitled under the Insurance Act 2015 to remove cover and decline the claim. The complaint was not upheld and no remedy was awarded.

The Ombudsman's reasoning

The ombudsman applied the Insurance Act 2015, which requires a policyholder to make a fair presentation of the risk. Ms W was obliged to disclose material information about prior issues with the tenant (rent arrears, damage, eviction proceedings) even though Great Lakes' question could be read as referring only to the current tenancy agreement. The ombudsman found these prior issues were material to Great Lakes' decision and that any insurer would reasonably decline to offer cover for damage from a tenant with such a history. Under the legislation, Great Lakes was entitled to 'reset the clock' and offer the policy as it would have done with fair presentation, which meant excluding the accidental and malicious damage cover. The timing of Great Lakes' discovery (upon claim) did not make its action unfair or unlawful.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website