Upheld: Travel / life insurance claim disputes complaint against First Central Underwriting Limited trading as 1st Central Underwriting

Decision detail

Summary

Miss S complained that First Central unfairly declined her motor insurance claim following an accident in September 2025, arguing she was not covered because the policy excluded commuting use. Miss S had taken out the policy in May 2025 while working from home, selecting social-only use as appropriate for her circumstances at that time. She subsequently changed jobs in July 2025 and began commuting but did not notify First Central of this change. The ombudsman found no misrepresentation under CIDRA rules as Miss S's original application was accurate, and determined it was fair and reasonable to reassess the claim on a proportional basis given First Central would have provided commuting cover for only 1% additional premium. The ombudsman upheld the complaint and ordered reassessment of the claim and £200 compensation for distress caused.

The Ombudsman's reasoning

The ombudsman found that while the policy terms strictly excluded commuting, Miss S did not misrepresent her circumstances when applying in May 2025 as she was genuinely working from home at that time. Although Miss S failed to notify First Central of the change in circumstances when she started commuting in July 2025, the ombudsman considered it fair and reasonable to apply CIDRA principles proportionally rather than apply a blanket exclusion. Given First Central was willing to provide commuting cover for only 1% additional premium, the ombudsman determined reassessment on a proportional basis was appropriate. The ombudsman also awarded compensation for distress caused by the unfair claim denial.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website