Partially upheld: Home insurance claim disputes complaint against Zurich Assurance Limited

Decision detail

Summary

Mr F claimed on a group income protection policy after stopping work in early 2023 to care for his seriously ill wife and manage his own inability to work. His GP certified him unfit to work citing 'family illness' and later 'bereavement' following his wife's death. Zurich declined the claim in November 2023, concluding Mr F lacked a recognised mental health disorder required under the policy's definition of 'incapacity'. After Mr F appealed with additional medical evidence, Zurich arranged an independent medical expert assessment, which concluded Mr F experienced non-pathological stress from bereavement rather than a diagnosable mental illness. The ombudsman found Zurich's claim decline was fair and reasonable but upheld the complaint in part due to significant delays in handling the appeal, increasing compensation from £200 to £400 to reflect the impact on Mr F during his vulnerable circumstances.

The Ombudsman's reasoning

The ombudsman concluded that Zurich fairly declined the claim because the policy definition of 'incapacity' requires illness, and the evidence did not establish a recognised mental health disorder. While Mr F experienced genuine grief and emotional distress following his wife's death, the IME's expert assessment (from an experienced consultant psychiatrist who spent three hours with Mr F and reviewed all available medical evidence) concluded his reaction was non-pathological stress rather than a diagnosable mental illness. The ombudsman placed greater weight on the IME's detailed reasoning than the GP's opinion, finding the IME's conclusion that Mr F's reaction was within expected parameters for bereavement. However, Zurich's handling of the appeal involved unjustified delays in progression and communication, particularly given Mr F's vulnerable circumstances.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website