Not upheld: Home insurance claim disputes complaint against Intact Insurance Limited

Decision detail

Summary

Mr I claimed on his legal expenses insurance policy with Intact Insurance Limited for a boundary dispute with his neighbour. Intact's panel firm L assessed the claim and concluded it lacked reasonable prospects of success, recommending Mr I obtain a boundary surveyor's report to establish the boundary line. Intact declined to cover the claim and explained that Mr I was responsible for funding the surveyor's report. The ombudsman found that Intact acted fairly in relying on L's qualified legal advice and reasonably expected Mr I to obtain the surveyor's report to establish his legal ownership or right to the land, as required by the policy terms. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that legal expenses insurance policies routinely require claims to have reasonable prospects of success, and this is a fair requirement as litigation is expensive. The ombudsman will not evaluate the merits of the underlying claim but instead assesses whether the insurer acted fairly in relying on qualified legal advice. Since L provided detailed legal reasoning and the ombudsman found no evidence the advice was obviously wrong or based on factual mistakes, Intact reasonably relied on it. The ombudsman found it reasonable to expect Mr I to obtain a boundary surveyor's report to establish his ownership or right to the land before the claim could be properly assessed, and that Intact did not act unfairly in declining to fund this report.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website